The 23-year-old arrives at the BayArena for an undisclosed fee as a replacement for Daniel Carvajal, who has returned to Real Madrid after an impressive season in the Bundesliga.
Donati recently starred for his country at the Under-21 European Championships in Israel, where the Azzurri were beaten finalists against Spain.
After loan spells at Lecce, Padova and Grosseto, he believes that he is ready to test himself at a higher level.
"Bayer is a top German club and also has a good reputation in Italy," he told the club's official website.
"I am looking forward to the Bundesliga and being in the Champions League this season with Leverkusen is a very special challenge.
"I'll give everything to achieve our goals with Bayer."
Leverkusen director Wolfgang Wooden added: "With Giulio Donati we have a young, aspiring and committed player, which fits perfectly into the profile of Bayer Leverkusen.
"We are convinced that Donati will successfully fill the position of right-back."
Donati has signed a four-year deal with the Bundesliga club.