The 24-year-old Morocco international passed a medical at the Reds' Melwood training ground on Friday before completing his move from Heerenveen
The Morocco international passed a medical at the Reds' Melwood training ground before signing a "long-term" contract with the club.
The 24-year-old scored 20 goals in 68 appearances for the Eredivisie outfit, after joining from De Graafschap in 2009.
"I'm very happy to play for this big club," he told Liverpool's official website.
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"The coach gave me a good feeling. It will be a dream to play with these big players and I hope training will help me to be a good player here.
"When I watch Liverpool it's always a good atmosphere, the fans are fantastic and I'm happy to be here."
Liverpool manager Brendan Rodgers hailed the acquisition of Assaidi, who had reportedly attracted the interest of Dutch champions Ajax.
He said: "We're delighted with the signing, he's a young player who has done very well, in particular in the last couple of seasons, in Holland.
"He fits our style perfectly, he's an exciting player who is very good in one versus one situations and I think he's a player that will excite the crowd.
"We're not expecting too much too early, he needs time to adapt but we're delighted he's chosen to come here over a number of other clubs.
"As I said, I'll look forward to helping his development and I hope he'll become a very good part of this club."
Assaidi will wear the No.11 shirt at Liverpool which was recently vacated by Maxi Rodriguez.