The England midfielder has long been linked with a move to Anfield and the deal has now been confirmed by the Merseyside club, with Lallana signing a long-term contract at the club.
Lallana, who featured for England in the World Cup in Brazil, spoke of his delight at joining such a "special" club.
"I've been granted my wish to play at such a fantastic football club, in Champions League football and competing for Premier League titles," the 26-year-old said upon joining the Merseyside club.
"I'm so excited for the next chapter of my career, coming to a special club like Liverpool. Last season, deep down, I was thinking: hopefully one day I'll be able to play in that team. That dream is reality now."
"We're delighted to have secured one of the Premier League's top talents," said Liverpool manager Brendan Rodgers. "I'm excited about working with Adam and helping him progress even further."