The 24-year-old has penned a five-year contract with the Reds, having rejected a move to English champions Chelsea on Tuesday.
Oxlade-Chamberlain made 198 appearances for the Gunners since joining them from Southampton in August 2011, scoring 20 goals. He played four times this season for the north Londoners.
Liverpool also added winger Mohamed Salah from Roma for £34m, fullback Andrew Robertson from Hull for £8m and striker Dominic Solanke (free following Chelsea exit) to their roster this summer.
The Merseysiders still have their eye on Monaco winger Thomas Lemar and Southampton centre-back Virgil van Dijk, but their star playmaker Philippe Coutinho is being hotly pursued by La Liga giants Barcelona.