The 25-year-old is the club's fifth transfer-window signing, and he follows Iago Aspas, Luis Alberto, Simon Mignolet and Kolo Toure into Anfield.
Cissokho, who has one cap for France, has been signed to put pressure on first-choice left back Jose Enrique, whose form dipped early last season before picking up at the end of the campaign.
British media reported the deal also included an option to make the move permanent at the end of the season.
"It's going to be a great experience to be able to rub shoulders with the club's top-quality players," Cissokho said on the club website (www.liverpoolfc.com).
"I have experience in the game but coming here there will still be lots of things to learn and discover as I work with everyone every day.
"I can learn from my new manager, get to know the new style of play here, familiarise myself with different opposition teams and learn the language. It's going to be a great experience for me, and of course playing for the club for the first time is something I'm excited about."
Cissokho has played for a number of high-profile European clubs and has Champions League experience with Porto, Olympique Lyonnais and Valencia.
(Reporting by Toby Davis; Editing by Sonia Oxley)
