The midfielder, who is currently in London preparing to lead his country's Olympic Games campaign, has penned a deal with the Rosanero that will keep him in Sicily until 2015
The defensive midfielder, who will captain his country in the upcoming Olympics, has penned a three-year contract with the Rosanero and will arrive in Sicily after his participation in the games.
"Palermo announce that they have purchased Egidio Arevalo Rios from Club Tijuana," a brief statement on the club's official website read.
Arevalo, who has been capped 34 times by his country, played a key role in Uruguay's fourth-placed finish at the 2010 World Cup and their Copa America triumph 12 months later.
The 29-year-old, who has enjoyed two separate spells at Penarol during his career, had only joined Tijuana from Botafogo last year.