Town see off several rivals to bring in full-back Dixon for new season
The 25-year-old, who was also wanted by Celtic and a couple of Football League clubs, will officially join the Terriers on July 1 when his contract at Tannadice Park runs out.
United were keen to keep hold of Dixon but the defender had set his mind on moving south to England.
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Hide AdTown chief Grayson said: “Paul turned down a number of other Championship clubs to join us, which I believe speaks volumes about the football club.
“He is a left-back with lots of games behind him for both Dundee and Dundee United and he also has international experience with Scotland.
“Paul will be a good addition to our squad for the upcoming season and many beyond.”
Aberdeen-born Dixon has spent four years with United after starting his career with local rivals, Dundee. Along with Celtic, he was also being tracked last season by Cardiff City and Leicester City, but it is Huddersfield who have won the race to snap up the full-back on a free transfer.
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Hide AdThe Scotland Under-21 international joins Crystal Palace winger Sean Scannell in signing for Huddersfield as Grayson looks to build a squad capable of stepping up to the Championship.
Heading out of the Galpharm Stadium is Greg Pearson, the 19-year-old Academy graduate having had his contract cancelled by mutual consent despite it still having 12 months to run. He failed to make a first-team appearance for Town.
Meanwhile, Town’s return to the second tier after an 11-year absence has been selected for live transmission by Sky Sports.
The encounter with Cardiff City will now kick off the entire Football League season after being moved forward to Friday, August 17, kick-off 7.45pm.