Feliz will receive $4.5 million in 2010.
The 34-year-old hit .266 with 12 homers and 82 RBIs last season for the NL champion Philadelphia Phillies, who declined a $5.5 million option for 2010 and opted to pay a $500,000 buyout. Philadelphia then brought in Placido Polanco to replace him, agreeing to an $18 million, three-year deal.
"He's been an outstanding defensive player and a solid run producer for his entire career," Astros general manager Ed Wade said. "He played a premium position with a two-time World Series participant and was a key part of the Phillies' success. We're fortunate to have him on board."
The Astros' primary third baseman last season was Geoff Blum, who started 94 games at third. But Houston would like to return Blum to a role as a super-utility player. The Astros explored the possibility of bringing back Miguel Tejada to play third base, but Tejada's contract demands were too exorbitant than they had in mind.
"Geoff Blum has done a terrific job for us over the past two seasons, and despite the acquisition of a regular third baseman, we believe Geoff will get his at-bats with us and be a key contributor all around the infield," Wade said. "It's been a good week for us."
Enrique Rojas covers baseball for ESPNdeportes.com. ESPN.com's Jayson Stark contributed to this report.