Schaub, who turns 38 in June, signed to be Matt Ryan's backup prior to the 2016 season. He's played in seven games over the past three seasons, completing 6 of 10 passes for 36 yards.
"Matt has a great understanding of our scheme and brings valuable experience to the position," Falcons coach Dan Quinn said in a statement.
Schaub entered the NFL in 2004 as a third-round draft pick of the Falcons and was Michael Vick's backup for three seasons. Schaub's breakthrough season came in 2009 with the Houston Texans when he started all 16 games and threw for a career-high 4,770 yards, completing 396 of 583 passes with 29 touchdowns and 15 interceptions. Schaub earned Pro Bowl honors in 2009 and 2012 with the Texans, including the Pro Bowl MVP in '09.
Schaub's last start came December of 2015 while with the Baltimore Ravens. He's started 92 of 148 career games, throwing for 24,887 yards and 133 touchdowns (90 interceptions) while completing 2,098 of 3,281 passes (64 percent).
Information from ESPN's Vaughn McClure was used in this report.