Miller, a 16-year NBA veteran, appeared in 47 games for Denver during the 2015-16 season and averaged 1.3 points and 1.1 rebounds in 7.9 minutes per game.
Miller has played in 1,012 career games and posted averages of 10.8 points, 4.3 rebounds and 2.6 assists in 27.3 minutes per game for Orlando, Memphis, Minnesota, Washington, Miami, Cleveland and Denver.
"We're thrilled that Mike will be back with us going forward. He exemplifies what it means to be an ultimate teammate and professional, and his resume certainly speaks for itself," said general manager Tim Connelly. "Last season Mike made a major impact on our young core and we look forward to continuing to have his veteran leadership both on the court and in our locker room."