Balding returns to Newcastle on a deal until the end of the season with the No.8 having left Kingston Park in 2010 to join Worcester.
Ospreys second row Goode has agreed a loan switch - also until the end of the season - as the Falcons look to avoid the drop.
Newcastle Falcons have completed a transfer deadline day swoop for Ospreys second-rower James Goode on loan until the end of the season.
"I'm looking forward to the move to Newcastle, a club that I know well and have fond memories from my previous time in the north east," said Balding, who also played for Leicester and Gloucester.
"I'm fit, injury free and determined to make a big impression. I'm keen to get up to Newcastle and do my best before the end of the season.
"I want to prove I can play at this level and secure my future. Newcastle have given me a lifeline to play some games and I won't let them down."
The 29-year-old came through the ranks at the Cardiff Blues and played for Manawatu Turbos in New Zealand before joining the Ospreys in 2009.
"I am really impressed with the set-up at Kingston Park and I am looking forward to the challenge of helping the club secure its Aviva Premiership status," said Goode.
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