The Berlin outfit is the seventh club the Nigeria youth international would be joining on loan having previously spent the last five years away from Merseyside.
Awoniyi joined Liverpool in 2015 but he was immediately loaned out to FSV Frankfurt for the 2015-16 season. The following campaigns, he moved to the Netherlands to join NEC Nijmegen, Belgium's Royal Excel Mouscron and Gent before returning to Mouscron in January 2019.
The 2013 Fifa U17 World Cup champion spent the 2019-20 season at Mainz 05 where he scored a goal in 12 Bundesliga appearances.
After failing to secure a spot in Jurgen Klopp’s team this season, Awoniyi has returned to a familiar country for regular first-team football and he is eager to show his qualities at the Stadion An der Alten Försterei.
“I’m looking forward to a new home and the task at Union Berlin. Mainz was my second stop in Germany after Frankfurt and last year I was able to prove myself in the Bundesliga for the first time,” Awoniyi told Union Berlin website.
“At Union, I want to take the next steps, play as much as possible, develop and help the team to stay in the league.”
Prior to his signing, Union Berlin began their 2020-21 Bundesliga campaign with a 3-1 loss to Augsburg on Saturday.
However, the club's director of football Oliver Ruhnert believes Awoniyi’s signing comes as a boost for Urs Fischer’s side.
“Taiwo is a highly talented player who already knows the Bundesliga,” Ruhnert said. “He has already played in several countries and will certainly be settled in our team very quickly.
“With his physical robustness, his team spirit and work around the box. He should make our attacking game more flexible and further stimulate the attack.”