Blades manager Nigel Adkins previously worked with Sharp at three of his previous clubs and he had been linked with a move to Bramall Lane as part of a possible swap deal for Blades winger Jamie Murphy.
Sharp is under contract at Elland Road for another season but was not a regular in their side last season and Leeds have since signed two more strikers; Lee Erwin from Motherwell and Leicester City’s Chris Wood.
The 29-year-old started his professional career with Sheffield United and returned to the club in 2007 after an impressive spell with Scunthorpe, where Adkins was in charge at the time.
He has since played for Doncaster Rovers, Southampton and Leeds, as well as having loan spells with Nottingham Forest and Reading.
“I’ve had Billy at Scunthorpe and Southampton and I took him on loan at Reading,” Adkins said.
“Billy Sharp’s an excellent player who I’ve always admired and always liked. He’s a Leeds United player at this moment in time and that’s all I can say.”