The German international defender has signed a four-year contract at the London Stadium with the option to extend for a further two years.
Kehrer is West Ham's sixth summer signing after Nayef Aguerd, Gianluca Scamacca, Flynn Downes, Maxwel Cornet and Alphonse Areola.
Kehrer spent four seasons with PSG after joining from Schalke 04 in the summer of 2018 and he won three Ligue 1 titles, two Coupe de France, one Coupe de la Ligue and one Trophee des Champions.
The 25-year-old contributed 128 appearances for the Parc Des Princes outfit during his time at the club.
"I'm very excited to sign for West Ham," Kehrer, who can play at left-back or centre-back, told his new club's official website.
"This is the best league in the world and I'm excited about coming to play in the Premier League. I talked to the manager and he told me about how he sees me fitting in at the club.
"My biggest goal now is to get into the team, integrate myself within the group and enjoy playing for West Ham."
West Ham boss David Moyes added: "I am really pleased to welcome Thilo to West Ham United.
"He's a talented player, who can play in a number of defensive positions, adding strength and depth to our current options."
Kehrer has won 20 caps for the German national team.
West Ham have started the new season with back-to-back defeats to Manchester City and Nottingham Forest, and will be looking to pick their first points of the campaign when they host Brighton and Hove Albion on Sunday.
