The 21-year-old, who made two appearances for the Socceroos at the World Cup in Brazil, has signed a three-year deal at Craven Cottage.
"I'd like to thank everyone at the Newcastle Jets, including the players, staff and fans for their fantastic support over the past couple of seasons," Taggart told Fox Sports.
"I've had two really enjoyable years at the Jets and for that reason I will always hold the club and city of Newcastle close to my heart.
"I'm looking forward to starting a new chapter in my career with Fulham and working hard to take my game to another level."
Taggart scored 16 goals for the Jets last season to finish as the top scorer in the A-League.