According to the agreement, which can be extended beyond four years, the two companies will share in revenue from Internet advertising, Babylon said in a statement last week.
"Babylon's management estimates this agreement will have a substantial contribution to the company. At this stage management cannot assess the amount of this contribution," the statement said. A spokeswoman for the company declined to provide further details on the deal.
In 2012 Google was the main source of revenue for Babylon.
The company has said it expects strong revenue growth this year thanks to increased advertising income on the back of its plan to offer its latest product free of charge.
Babylon, which provides translation of words, phrases, documents and web pages in 77 languages, said 94% of its revenue comes from advertising.
Among the company's mobile applications is Babylon Touch, which allows users to point a camera at signs or menus and receive instant translations.
In November, Babylon filed for an initial public offering on NASDQA, with the aim of raising up to $115 million this year.