The Falcons did not disclose terms of the deal as they continue to overhaul the receiver position.
Atlanta acquired wideout Bryan Edwards in a trade last week with the Las Vegas Raiders and drafted Drake London of Southern California with the #8 overall pick last month.
The Falcons are playing the 2022 season without receiver Calvin Ridley, who is serving a suspension for betting on NFL games.
Allison, 28, played in three games last season with the Detroit Lions and did not record a catch on two targets. He caught 89 passes for 1,045 yards and six touchdowns in 46 games (14 starts) with Green Bay from 2016-19.
The Falcons are also breaking in a new quarterback with Marcus Mariota expected to take over for Matt Ryan, who was traded to the Indianapolis Colts in March.