Houston is fourth on the Knicks' career scoring list, trailing only Hall of Famers Patrick Ewing, Walt Frazier and Willis Reed. He will be in training camp next week with the franchise he led to the 1999 NBA Finals.
Forced to retire in October 2005 because of knee pain, Houston briefly tried a comeback last year with the Knicks. He didn't join the team until 10 days after practices began following the birth of a child, then played in only one preseason game before ending his long-shot bid to make the team.
He'll be there from the start this time, but making the roster will still be difficult. Now 37, Houston hasn't played in an NBA game since 2005 and would have to show that his knees can handle the running involved in new coach Mike D'Antoni's uptempo system.
Houston joined the Knicks in 1996 and made one of the most famous shots in franchise history, a running jumper in the closing seconds of the deciding Game 5 that gave New York an upset victory over top-seeded Miami in the first round off the 1999 playoffs. The Knicks went on to reach the finals, where they lost to San Antonio.
A two-time All-Star and one of the league's best outside shooters, Houston signed a much-criticized $100 million, six-year contract extension in 2001 and averaged a career-best 22.5 points in 2002-03. But chronic knee soreness then limited him. He averaged only 11.9 points in 20 games his final season, his lowest total since he was a rookie.
Houston wore No. 20 in his nine seasons with the Knicks but will now wear No. 14 in honor of his father, Wade, one of the first African-American basketball players at the University of Louisville.
"My father has been a great model of a man, and hopefully I can continue to carry what he taught me back to the court with the Knicks," Houston said in a statement. "Off the court, this is also symbolic to encourage men to be committed fathers as their role remains one of the most important factors in the lives of our youth."
Also Thursday, the Knicks signed swingman Dan Grunfeld, whose father, Washington Wizards president Ernie, played for the Knicks and was their general manager from 1991-99.