The 25-year-old has signed a contract until the summer of 2017 with the Fohlen and will join his new club at the end of the 2012-13 campaign.
Gladbach was keen to add some more creativity to its squad ahead of next season and sees the versatile Kruse as the ideal signing.
"We're really happy that Max Kruse has decided to join us," sporting director Max Eberl told the Gladbach website. "He's a quick, versatile player with excellent technique, who's certainly going to give us more options up front."
Kruse has been in sublime form so far this term, netting nine goals in 28 Bundesliga appearances, while assisting on eight more.