The 19-year-old midfielder, who spent last season at Nottingham Forest and Middlesbrough, will play Premier League football for the first time with the Clarets until JanuaryChelsea midfielder Nathaniel Chalobah has joined Burnley on loan until January.
The 19-year-old spent last season at Nottingham Forest and Middlesbrough but is yet to make a Premier League appearance.
The England Under 21 international, who can play in central midfield or at centre-back, is Burnley boss Sean Dyche's eighth signing since the Clarets secured their place in the Premier League.
Chalobah has also spent time on loan at Watford in the second tier, making 38 appearances and scoring five goals for the Hornets during the 2012-13 campaign.
Earlier reports on transfer deadline day had linked Burnley with a potential move for Manchester United midfielder Anderson.