No transfer fee was disclosed but media reports put it at 25 million pounds.
Wijnaldum, a member of the Dutch squad that reached the 2014 World Cup semi-finals in Brazil, is the seventh signing made by Liverpool manager Juergen Klopp for the new season that starts next month.
"It's always a dream to play for as big a club as Liverpool," the 25-year-old told www.liverpoolfc.com.
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Wijnaldum made 38 Premier League appearances and scored 11 goals for Newcastle last season after joining from PSV Eindhoven.
He will link up with Klopp's squad on their pre-season tour of the United States.
"I think he can be a great player for us," Klopp said. "He has already shown some really good moments in his career but the most exciting and important thing for me and my staff is that there is still so much extra to come from him."
(Writing by Rex Gowar; Editing by Tony Jimenez)
