The deal contains $14 million in guarantees, a source said.
The Buffalo Bills picked up Meachem in a private plane Tuesday afternoon and attempted to get him to sign, but the Chargers swooped in at the last minute and convinced Meachem to head to San Diego.
In 2009 he led the Saints with nine touchdown receptions.
The Saints selected Meachem, 27, in the first round of the 2007 draft. He joins Malcom Floyd, who has been slowed by injuries, and Vincent Brown, who will be in his second season, as the only receivers on San Diego's roster.
It was a day of ups and downs for the Chargers.
San Diego re-signed center Nick Hardwick to a three-year deal shortly before he was scheduled to become an unrestricted free agent, but also released left tackle Marcus McNeill due to a history of neck injuries and to clear cap space.
There's still a chance the Chargers could re-sign McNeill, a second-round draft pick in 2006 who played in two Pro Bowls. McNeill missed the final seven games of 2011 with a neck injury. McNeill had to pass a physical by Thursday to qualify for his $10 million salary.
The Chargers would also like to re-sign left tackle Jared Gaither, who helped stabilize the line in the season's final five games after he was waived by Kansas City. Gaither became an unrestricted free agent on Tuesday afternoon.
Information from ESPN.com's Bill Williamson, ESPN.com senior NFL writer John Clayton and The Associated Press contributed to this report.