The 22-year-old Morocco international has put pen to paper on a five-year contract at St Mary's.
Boufal said: "I'm very, very happy to sign for Southampton and I am really excited to play in St Mary's Stadium in front of the fans
"Southampton showed big interest in signing me, and I can see that this club is the best place for me to continue my progression as a footballer.
"I hope I can achieve many great things with Southampton
It is a very good club, with excellent facilities, and I feel it is the perfect environment to continue my development."
Saints boss Claude Puel had been looking to add more firepower to his squad after losing last season's top scorers Sadio Mane and Graziano Pelle over the summer.
Boufal scored 12 goals in all competitions in his first full season with Lille as they finished fifth in Ligue 1 and reached the final of the Coupe de la Ligue.
Saints' executive director of football Les Reed said: "I'm absolutely delighted to welcome Sofiane to Southampton Football Club.
"He has shown his undoubted qualities in France over the past few seasons, and we are extremely confident he will successfully adapt to life in the Premier League.
"Sofiane is a player we have watched develop closely over the last few years, and we're thrilled to have him join the club ahead of what promises to be a very exciting season, with Europa League football on the horizon.
"His excellent campaign with Lille last season meant a number of clubs were pursuing him to secure his services, but we're delighted that Sofiane sees Southampton as the best place for him to continue his development.
"Saints fans may have to wait for a few weeks yet to see him demonstrate his skills, as Sofiane had a delayed start to his pre-season training and will be working very hard with our fitness staff to get up to full match fitness."
Source : PA