Paronto, 32, was 3-1 with a 3.57 ERA and one save over 41 appearances for Atlanta in 2007. A veteran of five big league seasons with Baltimore (2001), Cleveland (2002-03) and the Braves (2006-07), he has a career record of 6-11 with a 4.00 ERA over 165 outings.
He also appeared in 65 games for Atlanta in '06, finishing with a 2-3 record and 3.18 ERA.
"Chad provides us with another experienced bullpen arm to put into our mix," said general manager Ed Wade. "We believe that the offseason additions combined with the returning relievers give us a solid relief corps, something winning teams need. Chad did a good job for the Braves, and we think he fits in well with us."
The Astros 40-man roster now stands at 35 players.
Alyson Footer is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.