Werner had spent the past two seasons with Chelsea, after joining the Blues from Leipzig in June 2020 for 47.5 million pounds, but struggled during his time at Stamford Bridge.
The 26-year-old Germany international has re-joined Leipzig on a four-year deal for a reported 25 million pounds, having netted 95 goals in 159 games from 2016 to 2020 for the Red Bulls.
During his two seasons with Chelsea, Werner only managed 10 Premier League goals. He scored 23 times for the club across 89 appearances in all competitions, but was part of their 2020-21 Champions League triumph.
“I’m very happy to be able to play for RB Leipzig again,” Werner said. “I had a great time here between 2016 and 2020, when we performed brilliantly as newcomers in the league.
“It was a dignified departure for me to leave the club as record goal scorer, but that’s in the past now and I’m looking ahead, because both I and the club have developed in the past two years.”
Marsch was dismissed after six months in the role in December, with Domenico Tedesco taking over and helping them qualify for the Champions League.
Leipzig also confirmed on Tuesday that they have signed Slovenian 19-year-old forward Sesko on a five-year contract, commencing July 2023. He will spend this season with Salzburg.
The club technical director Christopher Vivell said: “Benjamin Sesko is one of Europes best young talents and has a great amount of potential to become one of the best.
“He offers a lot in his game, he’s extremely fast, has a great jumping reach and is strong in the air. Benjamin has a true eye for goal and, despite his height, is technically gifted and mobile. His qualities make him a unique and special player.”