The 29-year-old, who had been with the Seagulls since August 2014, has put pen to paper on a three-year deal with the Royals.
Baldock passed a medical earlier on Monday and is expected to be available for Reading's Championship opener against Derby County on Friday evening.
"I'm very happy that Sam has joined us here at Reading, having pursued his signature throughout the summer," Royals boss Paul Clement told the club's official website.
"I always felt he was the right striker for us to bring to this club in terms of his age, his experience and his quality.
"Now, I look forward to working with Sam on the training field in preparation for Friday night's home game against Derby County."
Baldock scored 18 goals in 81 league appearances for Brighton after joining from Bristol City four years ago.