Smith, who hasn't played an NFL game since the 2015 season when he was a member of the Oakland Raiders, posted a picture of himself signing his new contract on his Instagram page with the message: "Life is good. I'm thankful. I'm blessed. I'm a Cowboy."
Jay Glazer of Fox Sports first reported the Cowboys signed Smith to a one-year deal, adding: "[He's] Clean and sober now; incredible how much he's turned his life around."
NFL Network's Ian Rapoport reported the deal is worth $4 million, and colleague Mike Garafolo noted $2 million is in base salary and $2 million is in sack incentives.
The San Francisco 49ers selected Smith with the No. 7 overall pick of the 2011 draft, and he quickly became one of the best pass-rushers in the league.
He tallied 14 sacks as a rookie and a career-best 19.5 sacks during a Pro Bowl effort in 2012 while helping lead the 49ers to the Super Bowl.
However, off-field issues defined the next portion of his career.
As ESPN's Todd Archer noted, he was arrested in 2013 on suspicion of DUI when he crashed his truck into a tree. He was also suspended for nine games in 2014 for violating the personal conduct and substance-abuse policies.
The 49ers released him in 2015 following an arrest for hit-and-run, DUI and vandalism charges, and he was suspended again in 2015 for violating the league's substance-abuse policy.
The Raiders, who signed him following the San Francisco release, released him in 2018 following an arrest for charges that included domestic violence, assault and false imprisonment. He settled the domestic violence case when he pleaded no contest to two misdemeanor charges.
Smith, still just 30, is working toward reinstatement, and Rapoport reported, "Dallas is confident it will happen."
The team could use the help along the defensive line considering defensive end Robert Quinn joined the Chicago Bears this offseason after he posted 11.5 sacks for the Cowboys last year.