Tonali has signed a five-year contract at Saint James’ Park to become Newcastle’s first signing this summer.
The transfer fee paid by the Magpies makes Tonali the most expensive Italian footballer of all-time.
The 23-year-old joined AC Milan initially on loan from Brescia in the summer of 2020 before making the move permanent the following summer.
Tonali helped AC Milan win the Serie A title in the 2021/2022 season and reach the semi-finals of the UEFA Champions League last season.
Newcastle finished fourth in the Premier League last season and Tonali’s signing will aid their cause to compete in Europe’s premier club competition next term.
"First of all, I want to thank Newcastle United because they are giving me a huge opportunity for my career," Tonali told the club's official website.
"I want to repay the trust on the pitch, giving it my all, as I always have. I'm really excited about playing at St. James' Park, I can't wait to feel the warmth of the fans."
Newcastle manager Eddie Howe added: "He is an exceptional talent and has the mentality, physicality and technical attributes to be a great fit for us.
"At 23, Sandro already has important experience as a key player in one of Europe's top leagues and in the Champions League, as well as playing for his country.
"But he also has the opportunity and potential to grow and evolve with us, and I'm excited to add him to our squad as we approach the exciting season ahead."
Tonali has 14 caps for the Italian national team.
