The 23-year-old has joined Jurgen Klopp’s men on a five-year contract and will wear the number 20 jersey.
Jota joined Wolves from Atletico Madrid on a permanent deal in the summer of 2018, having spent the previous season initially on loan at Molineux.
The Portugal international made 131 appearances in all competitions for Wolves during his time at the club and scored 44 goals.
He becomes Liverpool’s third summer signing and the second in as many days after Thiago Alcantara joined from European champions Bayern Munich on Friday. Greece left back Kostas Tsimikas arrived earlier in the transfer window from Olympiacos.
Following confirmation of his move, the former FC Porto forward told the club's official website: "It’s just a really exciting moment for me and my family.
"All of my path since I was a kid and now, to join a club like Liverpool - the world champions - is just unbelievable. I just want to get started.
"It is one of the best teams in the world – the best at the moment because they are world champions. When you look at the Premier League, you always see Liverpool as one of the biggest teams in the country, so it’s impossible to say no.
"So we just want to come [here], to give our best and hopefully I can become a good option for Liverpool in the future."
Jota has won four caps for the Portugal national team.
