Papanikolaou will be available for Denver's game Thursday night against Utah at the Pepsi Center.
The 6-foot-8, 225-pound Papanikolaou averaged 4.2 points and 2.7 rebounds in 43 games with Houston last season. He was drafted by the New York Knicks in 2012, dealt to Portland and then to the Rockets in 2013.
Green appeared in 46 games for Denver over the last two seasons and averaged 3.2 points. He was traded to the Nuggets on the night of the 2013 draft after the Jazz selected him with the 46th overall pick.