The 23-year-old centre-back leaves the Scottish Premiership side after seven years at Fir Park.
"Once I learned of Fulham's interest, it was a no brainer for me and I couldn't wait to get down and get signed," Newcastle-born Hutchinson told the club website.
"Obviously we all know the size of club that Fulham is and I couldn't wait to come and have a look at it.
"There's no hiding the fact that going from the SPL to the Championship is a step up, but it's one that I do believe I'm ready for and I can't wait to get started."
Hutchinson made almost 150 appearances for Motherwell, scoring at least one league goal in each of the last five seasons.
The Scottish club did offer him a new deal, but couldn't convince him to stay north of the border.
"I had mentioned to his agent that we would offer him slightly improved terms from last season, but it was fairly clear that there was some big hitters looking at him," Well boss Stuart McCall told their website.
"Shaun has been excellent for Motherwell and this move is a reward for all his hard work and dedication."
Fulham also have the option to extend his contract by a further year if they wish.