Luol Deng will exercise his $10.1 million player option to remain with the Miami Heat, his agent, Herb Rudoy, told ESPN on Monday.
Deng, 30, held the option for the final season of a two-year deal he signed with the Heat in the aftermath of LeBron James' defection last summer.
Sources told ESPN earlier Monday that the Heat were fearful Deng would opt for free agency along with Dwyane Wade, who is widely expected to become a free agent Wednesday.
Deng shot 35.5 percent from 3-point range and was the Heat's best perimeter defender in 2014-15, but he averaged just 14 points and 5.2 rebounds, which were his lowest numbers since his rookie season.
With Deng's decision, Miami is basically set at small forward. Deng will be the presumed starter, with fellow former Duke star Justise Winslow -- the Heat's first-round pick this year -- and James Ennis backing him up.
A two-time All-Star, Deng enjoyed his best years with the Chicago Bulls, averaging 16.1 points and 6.4 rebounds. The Bulls traded him to the Cleveland Cavaliers midway through the 2013-14 season.
ESPN.com's Michael Wallace and The Associated Press contributed to this report.