In exchange, the Royals will send the Tigers a player to be determined by Oct. 15. To make room for Colon on the 40-man roster, the Royals transferred outfielder Reggie Sanders from the 15-day to the 60-day disabled list.
The Sanders move will not affect his ability to come off the disabled list if he's ready in the next few days.
Colon, who pitched for Detroit last year but had offseason neck surgery, was on a rehabilitation assignment with Triple-A Toledo in June when he was involved in a clubhouse altercation.
The Detroit Free Press reported that a dispute arose over Colon's playing loud music. Colon got into it with teammates and pitcher Jason Karnuth tried to break up the scuffle. Karnuth suffered facial injuries when he was punched and had to undergo plastic surgery in which screws were inserted into broken bones.
Colon told the newspaper that he didn't realize Karnuth was struck during the incident and that he apologized twice to his injured teammate.
The Tigers suspended Colon for seven days. Later Colon was charged with felonious assault.
Royals general manager Dayton Moore said he has known Colon, who signed with the Atlanta Braves in 1995, for many years. Moore was in the Braves' front office when Colon was pitching in the organization.
"The only thing I can say is that Roman Colon is a person with high character and is very much respected by the teammates and people he was associated with in baseball," Moore said.
"I've known Roman since he was 16 years old and I'd trust him in my house with my family."
In 20 games last season for the American League champion Tigers, Colon was 2-0 with a 4.89 ERA. In 38 2/3 innings, he gave up 46 hits and 21 earned runs with 25 strikeouts and 14 walks.
Because of neck surgery, he started the season on the disabled list and was on a rehab assignment with Toledo. He appeared in six games with a 0-1 record and a 3.60 ERA.
After the clubhouse incident, Colon was suspended and then assigned to Double-A Erie where he pitched in five games with a 2-0 record, one save and a 5.91 ERA.
Colon, 6-foot-6 and 225 pounds, is from Monte Cristi, Dominican Republic.
After making his Major League debut with the Braves in 2004, he was traded to the Tigers with pitcher Zach Miner for pitcher Kyle Farnsworth on July 31, 2005.
Colon has appeared in 73 Major League games with a 6-7 record and 5.03 ERA. He has made eight starts.
"We think he can be part of our future. He could be a fourth or fifth starter, a middle man or a setup guy," Moore said. "He's still relatively young."
Moore said that Colon will work out at the Royals' Surprise, Ariz., facility for several days and then be assigned to a club, probably Triple-A Omaha.
Dick Kaegel is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.