On July 28, 2006, he was traded to the Texas Rangers with minor league outfielder Nelson Cruz for outfielders Kevin Mench and Laynce Nix, relief pitcher Francisco Cordero, and minor league pitcher Julian Cordero. According to Brewers General Manager Doug Melvin, the Brewers attempted to re-sign Lee, but by July 27, it became apparent he would not sign a contract extension. The Brewers reportedly offered a four-year, $48 million contract extension, close to the four-year, $50 million extension David Ortiz signed earlier in 2006. Lee's agent Adam Katz said the two parties were too far away in negotiations.
On November 24, 2006, Lee agreed to a six-year, $100 million contract with the Houston Astros. Lee had a productive first year in Houston, hitting .303 with 32 home runs and driving in 119 runs, which was good for a three-way tie in the National League with Miguel Cabrera and Prince Fielder.