The brother of Burnley's Michael, Duff has been capped at under-21 level for Northern Ireland and becomes Bradford's sixth new signing of the summer.
Duff told BBC Radio Leeds: "This is a great opportunity for me to play for a big club and an excellent manager. I feel this is the right move for me."
His move to West Yorkshire ends a 10-year spell at Cheltenham, where he made over 200 appearances since his debut in August 2000.
"I was taking stock of my career and decided this was best for me. I felt a few years ago my career was going very well, but then I got an Achilles injury that plagued me and set me back," Duff explained.
"I had surgery on it last year and that totally sorted it out, which is great. But it has hindered my career a bit.
"I wanted to get my career back on track and I feel this is the move that can do that for me.
"Bradford is a club looking to get out of this league and gain promotion as soon as possible and I want to help in that.
"[Manager] Peter Taylor was a big draw for me. I've lived with a couple of guys that played under him at England under-21 level and they have great things to say about him.
"So this is a new challenge and new advantage for me and it is very exciting."
Source: BBC Sport
Source: BBC Sport