The deal is worth $5 million, sources told ESPN.
Smith, 34, could serve as the closer, a job he has held at various points in his 11-year big league career. He saved 22 games for the World Series champion Texas Rangers this year -- the third consecutive season in which he won a title after pitching in the bullpens of Houston in 2022 and Atlanta in 2021.
Smith arrived in Kansas City as a starter in 2012 but transitioned to the bullpen the next season and has been one of baseball's workhorse relievers. Since 2013, Smith has pitched in 557 regular-season games, more than all but a dozen relievers.
In that time, he has thrown 521⅓ innings with a 3.5-to-1 strikeout-to-walk ratio, a 3.38 ERA and 113 saves. He served as a vital contributor to the Braves' title, throwing 11 scoreless innings in the postseason, where his career ERA is 2.91 in 21⅔ innings. With Texas, Smith allowed four runs in 3⅓ playoff innings.
Kansas City, which entered this winter primed to spend in the pitching market, continues to look at free agent starters as it tries to fill out a rotation headlined by left-hander Cole Ragans and Brady Singer. The Royals' bullpen remains filled with question marks, though a sterling late-season performance by right-hander James McArthur has him pegged to pitch in high-leverage situations.
He'll likely slot in before Smith, whose fastball velocity and slider shape has remained strong as he has aged. Smith's strikeout rate dipped below one per inning this year, but his walks dropped similarly, and he allowed only 0.78 home runs per nine.
The Royals' need for pitchers of all manner and variety is clear. Their 5.23 bullpen ERA was the worst in the American League last season, and their starters weren't much better with a 5.12 ERA, ahead of only Oakland for last in the league, en route to a 56-106 record.
In a corresponding roster move, the Royals designated pitcher Collin Snider for assignment.