The team announced the deal on Tuesday. Terms were not disclosed. Reece had been slated to make $540,000 this season as an exclusive rights free agent.
Reece has played 31 career games for Oakland. He has 56 career receptions for 674 yards and five touchdowns, and has rushed for 234 yards on 48 attempts with one touchdown.
Reece is a converted wide receiver who brings versatility to Oakland's offense with his ability to line up out wide or play as a traditional fullback.
Reece had two catches for 30 yards in the Raiders' 22-14 loss to San Diego on Monday night.