The Argentina international, who spent the 2010-11 season on loan at the Estadio da Luz, has penned a five-year contract with the Eagles.
Benfica confirmed the deal on their official website on Wednesday and although they refused to disclose the size of the transfer fee, it is believed that the Lisbon club have paid somewhere in the region of €10 million for the 22-year-old.
Salvio, who has been capped five times by his country, netted 10 times in 39 appearances in all competitions during his previous spell in the Primeira Liga.
However, the Lanus youth team product, whose buy-out clause has been set at €60m, struggled to nail down a regular berth in Atletico's starting lineup last season.
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