The 28-year-old has penned a one-year contract with the option to extend his stay by a further 12 months.
Collins is new Oxford boss Michael Appleton's first signing for the League Two club.
"I was really impressed by what Michael told me about the club and what the new owners want to happen. Something looks to be happening at Oxford and I am excited to be part of it," Collins told the club's official website.
Oxford start the new season at home to Burton Albion on August 9.