The 22-year-old had been heavily linked with a move to Goodison Park to link-up with his former boss Roberto Martinez throughout the summer, but had to wait until Monday's deadline to seal the deal.
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He told evertontv: "To be honest I am over the moon. The last few hours have been nerve-racking and I am delighted to be here.
"Once I knew Everton were interested there was no going back - I wanted to come here and try and establish myself.
"I worked under the manager for four years at Wigan, they were four brilliant years. I loved every minute of that. I know some of the boys who are here so it was a no-brainer to be honest."
McCarthy was the third player to join Everton on transfer deadline day, with Gareth Barry and Romelu Lukaku joining on loan until the end of the season from Manchester City and Chelsea respectively.