Morales is coming off a season in which he went 2-2 with a 4.62 ERA in 20 games for the World Series champion Red Sox. He was a member of the Rockies when they made their run to the World Series in 2007, only to be swept by Boston.
Colorado also picked up minor league reliever Chris Martin in the deal.
The 29-year-old Herrera hit .292 with one homer and 16 RBIs in 195 at-bats for Colorado this year. He played second base, third, shortstop and two games in left field.
This has been a busy offseason for the Rockies, who recently acquired lefty Brett Anderson from the Oakland Athletics.
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