Gagne was drafted by the Flyers in 1998 and had played his entire career in Philadelphia. He has one year left on his current contract that will pay him $5.25 million.
"In adding Simon to the Lightning today, we acquire a very talented player that will play along side our top forwards," Lightning vice president and general manager Steve Yzerman said. "With his combination of speed and skill we are excited to have him with us and grateful he was willing to waive his no-movement clause."
In 664 career NHL games, all with the Flyers, Gagne has 259 goals and 265 assists. He has two seasons of 40-plus goals and four with 30 goals or more.
"I'm looking at this opportunity as a new challenge and a new start," Gagne said. "I'm really looking forward to playing with guys like [Vincent] Lecavalier, [Steven] Stamkos and [Martin] St. Louis. I'm excited to be a member of the Lightning and I'm looking forward to starting next season in Tampa Bay."
Walker was originally the property of the St. Louis Blues and played 62 games for the Lightning last year, scoring twice.