"We have spoken with him and he has agreed to sign up with Union Magdalena. I think he can still play soccer and has the capacity to lead the lads," Magdalena couch Eduardo Retat said. The terms of the deal were not immediately known.
Nicknamed "El Pibe" (The Boy), Valderrama, 41, played at the 1990, 1994 and 1998 World Cups and was voted South American footballer of the year in 1987 and 1993.
He retired in April 2003.
His deft touches, apparently lazy style and eccentric hair-do turned him into a icon in Colombia, where a seven-tonne, six-metre tall statute of him was unveiled in 2002, in front of Magdalena's stadium in the Caribbean port city of Santa Marta.
His career took him to Millonarios, Deportivo Cali, Atletico Junior and Medellin in Colombia, Montpellier in France, Valladolid in Spain and Tampa Bay in the United States.