The 27-year-old, who was released by Stevenage at the end of last season, becomes Red Devils boss Mark Yates’ first signing and will stay at Broadfield Stadium until the end of the 2016/17 campaign.
“I’m delighted to make my first signing as manager and very pleased it’s Simon, who I think is going to be a terrific asset for us in midfield,” Yates told the club’s official website.
“He’s great in possession and really looks after the ball. He’s also got good set-piece delivery and he knows what this division is all about.
“I saw him a few times for Stevenage last season and I was pleasantly surprised he became available at the end of the season. I’m delighted he’s agreed to come here, he’s going to play a big part for us.”
Walton added: “It’s great to at the club and I am really looking forward to working with Mark Yates.
“League Two is tough but Mark knows the division well and he has got some exciting plans in terms of the players he wants to bring in and the way he wants to play.
“It’s an exciting challenge at this stage of my career and one I am really looking forward too.”
Walton, who began his career at Leeds, played 33 times for Boro last season in their unsuccessful League Two play-off campaign.