ESPN's Marc Stein reports that it is a two-year deal worth $10 million and contains a player option for the second year.
Williams was waived by the Brooklyn Nets on Friday and was expected to join the Mavericks. The Nets reportedly agreed to buy out his contract, which had two seasons and $43 million left on a five-year, $99 million deal he signed with Brooklyn in 2012.
The 31-year-old averaged 13.3 points and 6.6 assists in 68 games last season and shot a career-low 39% from the field.
Williams, the No. 3 draft pick in 2005, is a three-time All-Star. For his career, he has averaged 17 points, 8.5 assists and 3.2 rebounds on 44.7% shooting.
On Monday, the Nets traded guard Steve Blake to the Detroit Pistons in exchange for power forward Quincy Miller, freeing up cap space.
- Molly Geary