The Uruguayan youngster had long been linked with a move to the Nerazzurri and has finally signed a five-year contract with Walter Mazzarri's side
The 20-year-old's move to the Serie A giants had been in the works ever since last January and he now has signed a five-year deal with the Nerazzurri, with the club confirming the news on their official website.
The Uruguayan midfielder, who has been capped at Under-20 level, is a product of the Defensor youth academy and made his official first team debut in September 2012.
A number of European clubs had shown an interest in signing Laxalt this summer, but he opted to complete a move to Italy and will now join head coach Walter Mazzarri's group for their trip to the USA.
Laxalt follows the likes of Mauro Icardi, Ishak Belfodil, Hugo Campagnaro and Marco Andreolli to Giuseppe Meazza this summer.