The left-back, who won one Champions League and the Premier League five times while at Old Trafford, joins from rivals Seattle Sounders following a two-week trial
The Frenchman was acquired from rivals Seattle Sounders in exchange for a first-round pick in the 2014 MLS Supplemental Draft and a conditional 2015 draft pick.
The 35-year-old is best known for the 10 seasons he spent with Manchester United between 1999 and 2008, where he won five Premier League titles and one Champions League before joining Arsenal for a two-year stint.
"Mikael will bring a tremendous amount of experience and a presence on the field and in the locker room," said Timbers head coach Caleb Porter.
"He is a quality player on both sides of the ball and his impact will certainly go a long way in helping to solidify our back line."
Silvestre, who was signed following a two-week trial, has 40 caps with the France national team and played in the 2006 World Cup.