Toronto was also expected to announce the signings of Canadian guard Cory Joseph and forward Luis Scola at an 11:30 a.m. ET news conference, which will be streamed live here.
Thursday is the first day that NBA teams are allowed to officially sign free agents, though most agreements have already been widely reported.
Toronto's big catch in free agency was Carroll, who was introduced at a morning news conference.
"Throughout my life I've been through a lot," an emotional Carroll said. "For an organization to take me under their wing and bring me here and make me a part of this team, it means a lot."
Carroll, 28, averaged 12.6 points and 5.3 rebounds while shooting 39.5% from three-point range for an Atlanta team that won 60 games in the regular season. He's known for his hustle and hard-nosed play, which have earned him the nickname "Junkyard Dog."
"We are thrilled with not only the skills but the intangibles DeMarre will bring to our team," said Raptors president and general manager Masai Ujiri.