Having agreed personal terms after the Reds met his release clause, the German goalkeeper successfully had a medical on Merseyside on Monday and put pen-to-paper on a five-year contract the next day.
Karius has been signed to bring extra competition to current first-choice Simon Mignolet, with the much-maligned Belgian having frustrated with inconsistent performances throughout the year, and he will take the vacant No.1 shirt at Anfield when he officially becomes a Liverpool player on July 1 when the transfer window opens.
Formerly of Manchester City's Academy as a teenager, 22-year-old Karius arrives as one of the Bundesliga's most highly-regarded 'keepers - keeping nine clean sheets in 2015-16 as he featured in every game.
The Germany U21 international, who helped Mainz to a sixth-placed finish last season as they qualified for the Europa League group stages for the first time in their history, is viewed as one of a number of Die Mannschaft's brightest prospects of a promising generation of goalkeepers.
He made 96 appearances for the Bundesliga side by the age of 22 and immediately usurps Adam Bogdan and Danny Ward, with the former expected to leave the club and Ward expected to seal a season-long loan to Huddersfield Town in the Championship.
Karius opts to take Reds' No.1 shirt as he looks to compete with Mignolet to be first choice 'keeper
Although second-fiddle to Bayern Munich's Manuel Neuer and the likes of Marc-Andre ter Stegen for Joachim Löw's national team, Karius - who has played at every youth level for his country - is seen as a low-risk long-term alternative to Mignolet having enjoyed a consistent final campaign with Mainz where he earned rave reviews for a variety of stunning saves.
As a result of his eye-catching season, Karius was acknowledged in a poll by Kicker, who twice a year asks footballers from the Bundesliga for their opinions, as the second best 'keeper in the country as 235 top-flight players responded to the poll.
Of the vote, 13.6% voted Karius as the best 'keeper with only Neuer, who received 23.8%, ahead of him. The shot-stopper conceded just 42 goals in 34 games last season for Mainz as an everpresent between the sticks.
He follows Joël Matip, on a free from Schalke, and Marko Grujić in a £5.1 million move from Red Star Belgrade, to become the Reds' third signing under Jürgen Klopp, with Matip and Grujić having secured deals in January.
The Reds boss will now look at other priority areas of his squad in need of strengthening, with Borussia Mönchengladbach midfielder Mahmoud Dahoud high up on the list.
Elsewhere, left-back Ben Chilwell of Leicester City is another target, though any hopes of luring Mario Götze from Bayern Munich to Merseyside may have been ruined with the attacking midfielder, formerly a star of Klopp's Borussia Dortmund side, set to stay at the German champions under Carlo Ancelotti.