The former Florida Gator played two stints with the Grizzlies in his career, from 2001-05 and again this season after being signed as a free agent in February.
Williams, 35, had missed the last 17 games with back soreness after averaging 2.0 points, 1.1 rebounds and 1.9 assists in 27 games with the Orlando Magic and Memphis this season.
The 6-foot-1 Williams remains the franchise's all-time assists leader with 2,069 helpers.
He posted career averages of 11.9 points, 7.2 assists and 2.4 rebounds per game for the Sacramento Kings, Grizzlies, Miami Heat and Orlando after being taken with the seventh overall selection by Kings in 1998 NBA draft.
2014: The Year in Music [PHOTOS]