The $4 million deal includes a club option for 2019 and was first reported by NBC Sports Boston.
Claimed off waivers in late May because the Boston Red Sox were in need of pitching depth, Fister helped secure his new deal for 2018 by putting together a solid seven-start stretch in the middle of last season.
The veteran sinkerballer will remain effective as long as he continues to produce ground balls. But he will turn 34 in February.
The 6-foot-8 righty's best season came with the Nationals in 2014, when he went 16-6 with a 2.41 ERA. He also is 4-2 with a 3.02 ERA in nine postseason starts and one relief appearance, including a hard-luck loss for the Tigers against San Francisco in his 2012 World Series start.
Information from ESPN's Scott Lauber and Jerry Crasnick was used in this report.