During the second half of last season, Cooper made 18 appearances for the Lions as they secured promotion to the Championship.
Manager Neil Harris has made a number of additions ahead of the new campaign but he is confident that Cooper can make a difference at the East London outfit.
Harris told the club's official website: "I'm delighted that we have been able to bring Jake back to the club on a permanent basis.
"I've made no secret of my appreciation and respect for how he performed last season and how we've been so keen to sign him this summer.
"He has signed a long-term contract so he can realise his potential here at Millwall. Jake has a strong personality and is a player who is capable of strong performances. I'm very confident that he can go on to become a top, top centre-half for this club."
Cooper - aged 22 - leaves the Madejski Stadium having featured on 42 occasions at the second tier.