The Red Sox also intend to exercise the option on reliever Scott Atchison, while they intend to decline options on Bill Hall and Felipe Lopez.
Ortiz, who turns 35 this month, hit .270 with 32 home runs and 102 RBIs last season.
Once the team picks up the option, Ortiz will be set to earn $12.5 million in 2011.
Hall, 30, would have earned $9.25 million had the Red Sox exercised his option, while Atchison, who, like Ortiz, will be 35 on Opening Day, will make the minimum salary, plus $40,000.
Third baseman Adrian Beltre also declined his option, thereby making him a free agent.