The Algerian has not trained with the first team since July after the Spurs coach told him he would not feature in his plans.
Following confirmation of the move, Bentaleb tweeted: "Delighted to have signed for Schalke, new chapter and new beginnings."
Speaking to the club's website, he added: "I am looking forward to the challenge of Schalke.
"I first heard about the interest six weeks ago and have hoped since that a move would be possible.
"My visit last week has reinforced that desire again. I am very happy and want to help the team achieve their goals for the season."
Director of sport Christian Heidel confirmed the agreement with Spurs for Bentaleb on Thursday morning.
"We have an agreement with Tottenham [for Bentaleb]," he told reporters. "We expect him to participate in training this afternoon."
"Bentaleb is 100% fit, but we need to be patient and give him a little time to integrate into the team."
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Bentaleb will also be reunited at Schalke with former Tottenham team-mate Benjamin Stambouli who is expected to make the switch from Paris Saint-Germain to Schalke in the coming days.
On the imminent arrival of former Spurs midfielder Stambouli, Heidel added: "He has just had his medical. We will wait for the results and we are positive that everything will be in order.
"Our new recruits know each other from their time together at Tottenham. They will [make] good additions to the team."
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