The 22-year-old, who spent last season on loan with fellow League One side Bradford City, becomes Uwe Rosler's fifth signing of the summer.
Rosler praised the ability of Hiwula, who came through the ranks at Manchester City and represented England at both Under-18 and Under-19 levels.
"I'm a big fan of him," Rosler, who like Hiwula was once a Man City player, told the official Cod Army site.
"He can play all the positions up front and is very versatile and dynamic and has already played over 100 games in our league.
"We know what we are getting and that is pure quality and a player who really wants to put down a marker."
Expressing his delight at joining the club, Hiwula said: "It took a little bit of time but now I'm here I just can't wait to get started.
"The manager was the biggest attraction for me to come to Fleetwood. He is someone I have worked with before at a younger age and I'm glad I can work with him again."