Smith came through the ranks at Sunderland and spent short loan spells with Gateshead and Carlisle United before joining Scottish Premiership side Kilmarnock in 2016.
As well as participating in Scotland’s top flight, the 26-year-old also played at the highest level in Northern Ireland with Coleraine and has since had stints with Swindon Town, Salford City, Chorley, Chesterfield and Hartlepool, who he represented in League Two last season.
He will join Shields on July 1st, after his contract with Hartlepool expires.
Smith said: “I’m really excited to join the club and can’t wait to get going and meet all the lads.
“Everyone knows what we’re trying to build here so I’m very focused and looking forward to the season.
“The way the gaffer wants the team to play, what the club is building on and off the pitch and where we want to get to is exciting.
“We’re all focused on next season and we’re going to attack the goals we have for the year ahead.”
Sunderland-born Smith won the Irish Cup during his time with Coleraine and made 15 appearances for Hartlepool last season as the newly-promoted side finished 17th in League Two.
As a North East-based player, he says he has kept a close eye on the Mariners’ progress over recent years, which has whetted his appetite for the challenge ahead.
Smith added: “I can’t wait to be a part of the club’s progress, because so much has been put in place and built for the future.
“The club clearly wants to reach a higher level in the pyramid but all we can focus on is the here and now and achieving our goal of promotion next season.
“I’ve played for some great clubs and I’m looking to bring the experience and quality I have to this team and show what I’m about to the fans.
“I’ve been here more than a few times to watch games and the support in the stands is first class.
“It’s vitally important that they come in their numbers every week and support us home and away, because we really do appreciate it.”
“He is a fantastic footballer and a brilliant professional who we feel will fit very well into our group.
“It’s clear how eager he is to get going here and how much hunger he has to help us achieve our goals.
“Martin has a great passion for the game, conducts himself in an excellent way and will be a really valued member of the squad next season.”