Bouma, 27, ends his long association with PSV, where he began his career, to join David O'Leary's side. He made his debut in 1994/95, and aside from loan spells with MVV and Fortuna Sittard, has played all his club football for the Phillips Stadion outfit.
"I am really delighted to be joining Villa," said the the Netherlands international. "It is a big club and I am really looking forward to playing for them in the Premier League."
Bouma won four Dutch league titles with PSV, and although Villa have not been English champions since 1981, the adaptable defender believes the team O'Leary has assembled is full of potential.
"I know Aston Villa want to be challenging at the top of the table and I want to help. I want to do my best to improve the club," he said.
"The manager, David O'Leary, was a massive reason for my signing for Villa. I had a great talk with him and he made it clear that he believes in me and my ability.
"That gives me confidence. I had a good feeling about Villa - with their history of being a big club and the people I have spoken to from the club were all very helpful. That's why I chose Aston Villa. Villa Park is also a really great stadium and I look forward to my first game for the club."
Bouma is capable of playing either at left-back or in the centre of defence, and he played a major role in PSV reaching the semi-finals of last season's Champions League.
A former PSV team-mate of Jaap Stam and Ruud van Nistelrooy, he completed a medical this morning prior to the completion of his transfer. But O'Leary must wait before seeing his new acquisition in action on the training pitch, with Bouma making a quick exit after his medical to team up with his Netherlands team-mates before their World Cup qualifiers against Armenia and Andorra.
Bouma's arrival at Villa follows those of Milan Baros, Kevin Phillips, Patrick Berger, Aaron Hughes and Stuart Taylor during the summer.
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