The 25-year-old originally held talks with Vale two weeks ago and it had seemed as if he would go elsewhere, with Northampton leading the chase.
However, after further talks with both clubs Collins has decided to take Vale's offer.
Collins, who was out of contract at Bury, was one of manager Brian Horton's primary summer targets and he was delighted to have landed the stopper he worked with at Huddersfield.
"He broke into the first team at Huddersfield aged 18 or 19 and he did well for me," Horton said.
"He's a big centre-back, he can throw it a mile. With him and Walshy in the side we'll be able to fling it in from both sides.
"I signed him on a good contract at Huddersfield because I thought he could get to the top, and I still think he's got the ability to go to the top.
"He's got good feet, he's good in the air, obviously, as he's six foot two, and he's very strong. I think that him and Walshy, no matter what system I play, they'll be a very, very strong two.
"He has plenty of experience at both First Division and Second Division levels and we are delighted to have got him."
