The German-American midfielder will head to England's League Championship after spending the opening years of his career in his native Germany.
Williams, who had been at Hoffenheim since 2011, joins the League Championship side that was relegated from the top flight this past season. The 24-year-old German-American has become a regular call-up for U.S. manager Jurgen Klinsmann, although he was unable to take part in the last set of friendlies and qualifiers, with U.S. Soccer citing a lack of fitness after an injury layoff at the end of the Bundesliga campaign.
“Danny is a versatile player, he possesses great energy and already has great experience in one of the top leagues in Europe," Reading director of football Nick Hammond told the club's official website. "He is an international player and at 24 years of age still has plenty of development ahead of him, so we will be delighted to welcome him to the club.”
Williams is Reading manager Nigel Adkins' latest notable signing, with the Royals having agreed to deals with Wayne Bridge and Royston Drenthe already this offseason. He will officially join the club on July 1 when the transfer window opens for an undisclosed fee. Williams began his pro career at Freiburg in 2008 before moving to Hoffenheim, where he teamed with U.S. internationals Fabian Johnson and Joe Gyau.
"I am very excited to be here, I am really looking forward to the season and to try to get the club back to the Premier League," Williams said. "I spoke to the manager yesterday when I did my medicine check and he is a really great, nice guy. I'm looking forward to working with him, everything is perfect here. I spoke to [former Reading player and Hoffenheim teammate Gylfi Sigurdsson] also because he is a good friend from Hoffenheim and a hero here! I would like to say to the Reading fans I will give 100 percent every game, I am proud to wear this jersey and will do everything to help this team back to the Premier League."