The former Blackpool left-back had been training with the League One outfit before deciding on a switch to Kellamergh Park ahead of Saturday’s 1-0 win at Hednesford Town.
The 34-year-old, who won 12 Scotland caps, has been without a club since leaving Fleetwood last summer, turning down a number of offers.
And after revealing Fylde beat off interest from higher levels, manager Dave Challinor told The Gazette: “It was all about timing for us with Stephen.
“He lives in Lytham and wanted to stay in the area. We lost two left backs in a week, so it all came together personally.
“He’d been training with Barnsley and they were interested in signing him, so we are delighted we managed to get him in.”
Crainey, 34, is no stranger to football fans on the Fylde coast, having made more than 300 appearances for Blackpool over six years.
He played in the Champions League for Celtic and had stints with Southampton and Leeds before leaving Pool for Wigan in 2013.
Crainey spent last season with Fleetwood and it’s that wealth of experience which Challinor thinks makes the signing even bigger.
He explained: “It’s a huge signing for us on the pitch, with his quality, and off it too.
“Stephen’s experience is second to none and I think he can have a huge impact around the club.
“He’s a player who has been there and done it, but is known for being professional. He has really good habits on and off the field.
“I think he can be huge for us, and the rest of the players can learn from him.
“We’ll also benifit in games that might get a bit tight and nervy. Hopefully his experience will help us through those.”
Dave Challinor wants AFC Fylde to take advantage of a free shot at closing the gap on the league leaders tonight.
The Coasters’ trip to Alfreton Town this evening is the only fixture in the Vanarama National League North, and a win would see them move into second place outright and within a point of leaders Nuneaton
Challinor’s men go into the game on the back of a hard-fought win at Hednesford, something the manager hopes to build on tonight.
He told The Gazette: “Tonight is a game in hand for u – no-one else is playing in the league, so it’s a real chance for us to make some ground.
“At this time of the year, with the weather dreadful and the pitches starting to struggle, you aren’t going to get many pretty wins.
“It’s a case of us getting through games and getting wins at the moment, and that’s what we did on Saturday.
“We probably only had that one moment of quality in the game and that got us the goal. That’s what it’s all about.”
Matty Hughes strike was enough to earn three points on Saturday, although injury to Danny Lloyd blighted an otherwise excellent afternoon.
The wide man limped off after just seven minutes following a bang to the leg but Challinor is hoping it isn’t as bad as first feared.
The boss explained: “We still have a few of the long-term injuries missing, but we are waiting on Danny Lloyd to see how bad his knock his.
“He took a heavy blow to the leg, a heavy dead-leg if you like, and we are going to leave it as long as possible before making a decision on him for Alfreton.
“Hopefully he will be OK. Everyone else came through Saturday’s game well.”