The Borussia Monchengladbach midfielder has completed a move to Arsenal.
The Gunners have long been linked with the Switzerland star, with leaked pictures showing him posing in the club’s new strip earlier this month.
Despite not disclosing the fee, an earlier report from Sky Sports had suggested that Arsenal will pay as much as £30million for his services.
Xhaka has signed a long-term deal and will join up with Arsene Wenger’s side after his country finish their Euro 2016 campaign.
He becomes Wenger’s first signing of the transfer window, in what many are predicting will be a busy summer for them.
And commenting on the club’s official website, the Frenchman says the club had been watching Xhaka for a long time.
“Granit Xhaka is an exciting young player, already with good Champions League and Bundesliga experience,” he told arsenal.com.
"We have been watching him for a long time now and he is a player who will add quality to our squad.”
Arsenal fans will now be hoping that Xhaka is the first of several big signings this summer as they look to bounce back from a disappointing season.
Top of their wish list is a world-class centre forward, with that area of the team having struggled this past season once again.
Who that could be remains to be seen, with a big money move for Juventus striker Alvaro Morata having been touted.