Williams, a fourth-round pick by Minnesota in 2002, played four seasons with the Vikings before spending three seasons with the Jaguars.
Williams has started in 93 of his 107 career games. He has 18 career interceptions, four sacks and nine forced fumbles.
He had 89 tackles and two interceptions last season.
Falcons general manager Thomas Dimitroff said Williams can play cornerback and safety.