Deduno, 27, made his Major League debut last season with the Rockies, allowing one run over four appearances and 2 2/3 innings.
Deduno, who can start or pitch in relief, figures to be a part of the pitching staff at Triple-A Tucson this season.
To make room for Deduno on the 40-man roster, the Padres designated utility man Oscar Salazar for assignment.
Salazar, 32, spent most of the past two seasons with the Padres. Salazar appeared in 120 games and hit .251 with six home runs and 38 RBIs in 239 at-bats.
The Padres will likely use non-roster invitee Kevin Frandsen as a utility infielder and Eric Patterson as someone who can bounce between second base and the outfield. The Padres will use Chris Denorfia as their fourth outfielder.
Deduno is 40-37 with a 4.35 ERA since signing with the Rockies in 2003. Almost all of that time has been spent as a starting pitcher. He was a combined 3-3 with a 3.83 ERA in 2010 between Class A Tri-City and Triple-A Colorado Springs.
Deduno was originally signed by former Rockies scout Felix Feliz, who now works for the Padres and gave a recommendation.
Deduno is said to have a plus-fastball with good life and sink and a power curveball. His changeup is still a developing pitch and might determine if he's better suited to pitch as a starter or reliever in 2011.
The Padres now have a full 40-man roster after Tuesday's transaction.