The 6ft 7in striker successfully completed his medical to become Rafael Benitez's sixth summer signing.
He said: "I am thrilled to be joining a club as prestigious and successful as Liverpool.
Crouch scored 16 goals last season and although Southampton lost their Barclays Premiership status, he was rewarded for his efforts with a call-up to England's end-of-season tour to the US, making his debut in the game against Colombia in New York.
"Once I heard of their interest in me it was hard not to think about what it would be like to pull on the famous red shirt and play in front of the Kop, but I was also very aware of my responsibilities towards Southampton.
"After a lot of thought I requested the permission of the chairman and board of directors of the club to talk to Liverpool.
"Southampton bought me from Aston Villa and allowed me to play regularly in the Premiership, resulting in an appearance for England in the summer.
"This helped my career tremendously and has now given me the opportunity to move to Liverpool and play on an even bigger stage, something no-one could realistically expect me to turn down.
"Under almost any other circumstances I would have committed myself to helping Southampton regain their Premiership status.
"There is a great group of players at the club and I am sure they will be successful in the coming seasons."
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