Financial details were not disclosed, but British media reported the Saudi Pro League champions paid £40 million ($51.33 million) for the 29-year-old.
Al-Ittihad posted a video on messaging platform X, formerly known as Twitter, with the title "Tigers are permitted to pass" in reference to media reports suggesting the deal might be delayed due to the breed of Fabinho's dogs which are prohibited from entering Saudi Arabia.
The video featured the Brazilian midfielder holding a tiger and saying: "I'm Tiger."
Welcome Fabinho 🐅 pic.twitter.com/JFaG2xdZts— Ittihad Club (@ittihad_en) July 31, 2023
"Today I leave my home. It's been five years wearing this jersey and always with the greatest honour and happiness possible. I love this club. Thank you, Reds, for everything we've experienced together. You will never walk alone," Fabinho wrote on X.
The Brazil international made 219 appearances for Liverpool since his arrival in 2018, and helped the team to the Premier League, Champions League, FA Cup, League Cup and UEFA Super Cup titles.
Fabinho was not always a regular for Liverpool last season after a loss of form. Liverpool manager Jurgen Klopp has overhauled his midfield by signing Argentina's Alexis Mac Allister and Hungary captain Dominik Szoboszlai, and the club is now searching for a holding midfielder to replace Fabinho.
The Saudi Pro League has become an attractive destination for high-profile players since Cristiano Ronaldo moved to Al-Nassr last January in a deal reported to be worth around $220 million per year.