A league source tells ESPN NFL Insider Adam Schefter that Hampton's contract is worth $21 million, including $11 million in guaranteed money.
The Steelers were facing a decision on whether to place their franchise tag on Hampton, with the hope of eventually reaching an agreement with him, or allow him to become an unrestricted free agent.
Hampton, a nine-year veteran, had 43 tackles and 2½ sacks last season for the Steelers.
With Hampton's contract accounted for, the Steelers instead used the franchise tag on Reed, the team announced.
Reed has a career 83.3 percent field goal completion percentage in eight seasons, all in Pittsburgh. He converted 27 of 31 field goals in 2009 and scored 122 points.
It would cost another team two first-round picks to acquire Reed if he signed a contract with it. The Steelers also would have seven days to match an offer from any other team.
The deadline for NFL teams to use their franchise tag is 4 p.m. ET Thursday.
ESPN.com senior football writer John Clayton contributed to this story.