The 19-year-old attacker has been linked with a switch to the Toffees in recent weeks, and the club are now in a position to confirm that he has signed a four-and-a-half year contract at Goodison Park.
Lookman told the club's official website: "It feels great to be an Everton player. As soon as I heard about Everton's interest I knew this would be the right place for me. Everton has a big history and I was also attracted by the manager.
"When you look at what he did at Southampton, and what he does with young players in terms of developing them, that was a big attraction.
"It was great playing in The Championship last season and for the last six months in League One but I feel like I'm ready to make the step up to the Premier League."
Ademola leaves The Valley having scored 12 goals from 49 appearances in all competitions.