Navarro, 28, has signed a five-year contract, opting to return home instead of continuing in the NBA, Barcelona said Thursday.
"We plan on extending a qualifying offer to Juan Carlos so that the Grizzlies retain the right to match any future offer if he ever decides to return to the NBA," Memphis general manager Chris Wallace said in a statement. "Juan Carlos made a positive contribution to the team and we wish him and his family all the best in his return to his homeland."
Navarro averaged 10.9 points, 2.6 rebounds and 2.2 assists with the Grizzlies and was chosen to the NBA All-Rookie second team in May. He made 156 3-pointers during the season, two short of equaling the NBA record for a rookie.
Navarro, who helped Spain win the 2006 world championship, is on the national team for the Beijing Olympics in August.
The Grizzlies obtained rights to Navarro through a trade with Washington. He was selected by the Wizards in the second round of the 2002 NBA Draft but remained in Spain.