The 29-year-old, who was linked to a number of Championship clubs, has penned a two-year contract at Ewood Park.
Blackburn boss Gary Bowyer: "Matt is a good signing for us.
"He will bring a lot of experience from playing in the Premier League and in the Championship.
"He's left-sided and has the ability to play in a couple of positions for us, both at centre half and at left-back.
"We're delighted that he's agreed to join us and we look forward to working with him."
Kilgallon spent three years at the Stadium of Light.
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