Pavel Lazarenko was Ukraine's prime minister during 1996-1997.
The 53 year old was arrested shortly after arriving in the United States in February 1999 for laundering millions of dollars through US banks of money obtained during the 1990s.
He was found guilty by a San Francisco jury on 29 counts in the case on June 3, 2004, which a judge later reviewed and cut back to 14 counts.
In addition to the jail term, he was ordered to pay a US$10m (A$13m) fine and faces three years of supervised release after he completes his sentence.
Lazarenko is the first former foreign leader to be tried and convicted in the United States since former Panama president Manuel Noriega was convicted in 1992 for drug trafficking.
Noriega received a 30 year jail sentence.
Prosecutors charged Lazarenko specifically with extorting and stealing US$44 m (A$18.4m) from a businessman and a state company over a seven-year period.
He was accused of laundering US$21m (A$27.65m) through US banks as well via numbered accounts in Switzerland and Antigua.
"Pavel Lazarenko misused his office to steal tens of millions of dollars for himself at the expense of the Ukrainian people and then sought to use the United States, and its banking system, as a safe haven to escape from the crimes he committed in Ukraine, Switzerland, and elsewhere," said US Attorney Kevin Ryan.
Lazarenko used some of the money to buy a US$6m (A$7.9m) home in wealthy Marin County, California, just north of San Francisco, using a sham company, the justice department said.
During the trial, Lazarenko's lawyers insisted that he had earned the money by doing business during the dismantling of the Soviet Union.
They also said he was the victim of a plot by a rival politician, former Ukrainian president Leonid Kuchma.
In 2000 Lazarenko was sentenced in absentia in Ukraine to 18 months in prison with probation for money laundering.
He was also accused by Ukraine authorities of having ordered two murders while he was the governor and prime minister of Dniepropetrovsk between 1992 and 1995.
The US Justice Department continues to seek a court judgment that Lazarenko forfeit US$22.8 m (A$30m).
That request will be reviewed in a court hearing on September 29.