The 26-year-old scored 27 goals in 40 league games last term to help Pescara win promoted to Serie A via the playoffs.
"It was a deal that happened in a flash, strongly desired by both sides, and rightly so", the striker said on AC Milan's website (www.acmilan.com).
Media reports said several Italian top-flight clubs, including Napoli and Juventus, as well as English Premier League champions Leicester City had been interested in Lapadula.
(Reporting by Anna Rzhevkina and Silvia Recchimuzzi in Gdynia; Editing by Ken Ferris)
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