Nemeth ranked first on the squad with 185 blocked shots last season. He played in a career-high 68 games and had a career-best 15 points, including three goals. The 26-year-old had a plus-27 rating, which was the highest by an Avalanche defenseman since Adam Foote was plus-30 in 2002-03.
Avalanche general manager Joe Sakic said of Nemeth: "Patrik is a big, physical defenseman who is an important piece of our D-corps."
Colorado claimed Nemeth on waivers from the Dallas Stars on Oct. 3. The 6-foot-3, 219-pound Nemeth has played in 176 career NHL games with three goals and 26 assists.
From Sweden, Nemeth was a second-round pick of the Stars in 2010.