Roma signed the Italy international on loan in January for a fee of 1.4 million euros ($1.58 million) with the option to make the move permanent at the end of the season for 13 million euros ($14.63 million).
They have now exercised that option, handing the 23-year-old a four-year deal.
El-Shaarawy turned his career around at Roma after failing to score in 15 Ligue 1 games on loan at AS Monaco during the first half of the season.
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"Today is a very special day for me because I am now a Roma player in every way," he told the Italian club's website (www.asroma.com).
El Shaarawy, who has 19 international caps for Italy, managed to win back his place in the national team thanks to his revitalised form at Roma.
He is currently with the squad at the European Championship in France after scoring eight league goals for his new club in 16 Serie A appearances.
(Reporting by Silvia Recchimuzzi in Gdynia,; Editing by Neville Dalton an Ian Chadband)
