Shiancoe, 33, signed for the veteran's minimum, a source told ESPN NFL Insider Adam Schefter.
Pitta underwent surgery Saturday night and will miss the entire 2013 season, coach John Harbaugh announced Sunday.
"Dennis is out for the year. It's the type of thing he's not going to be able to come back from this year," Harbaugh told reporters. "There's enough damage in there."
When asked if Pitta would be ready for next season, Harbaugh said: "It would be really, really rare for something you couldn't be back next year."
The Ravens were reportedly considering signing Shiancoe even before the injury to Pitta. Shiancoe played in just four games last season with the New England Patriots, and did not have any catches. He last played in an NFL game in 2011 with the Minnesota Vikings and has 243 receptions for 2,677 yards and 27 touchdowns in 148 career games.
"We're very excited to have him here," Harbaugh said. "Played against him a number of times. ... He's been in the league a long time and has a great career."
Pitta was one of the key figures of the Ravens' offense during their run to a Super Bowl championship last season. He was expected to take on a bigger role this year after Baltimore traded top wide receiver Anquan Boldin during the spring.
Pitta was preparing for his fourth season with Baltimore and was entering the final year of his contract. The 6-foot-4, 245-pounder caught 61 passes for 669 yards and seven touchdowns last season.
In the playoffs, Pitta had 14 catches for 163 yards and three scores.
Information from ESPN NFL Insider Adam Schefter, ESPN.com's Jamison Hensley and The Associated Press was used in this report.