The England Under-21 international has put pen to paper on a four-year deal, running until June 2030, having spent the second half of the 2025/26 campaign on loan at Goodison Park.
It is the third permanent addition of the summer for David Moyes's side, following the arrival of Hayden Hackney from Middlesbrough and the completion of Merlin Röhl's move from SC Freiburg after his own season-long loan.
George, who made 11 appearances during his loan spell after arriving on deadline day in the winter window, told evertonfc.com he had been eager to return as soon as the opportunity arose.
"I'm so happy to sign for Everton. I loved my time here on loan last season, so as soon as I knew it was a possibility to return, that's always what I wanted," George said.
"This is a massive club. I've seen for myself how passionate the fans are about Everton, how much it means to them – and I want to put on good performances, score goals, and create goals to make them happy.
"The fans and the boys in the changing room made me feel welcome as soon as I arrived in February. It's a strong group that's only going to get better.
"I'm excited for what is ahead for us as a group and club."
Born in London, George came through Chelsea's academy from the age of eight and was named among the substitutes for the first team for the first time against Everton, in April 2024. He made his senior debut four months later in a UEFA Conference League play-off, at the start of a breakthrough 2024/25 campaign in which he started eight of Chelsea's 12 Conference League appearances alongside now-Everton teammate Kiernan Dewsbury-Hall as the club won the competition, and featured twice more as they lifted the FIFA Club World Cup that summer.
"There is a lot more to come from me and with the manager, the coaches and my teammates, I know I'm in a great place to show it," George added.
"Everton is an environment that demands hard work from everyone, and I will give everything.
"To be in for the start of pre-season is something I was keen on. Now I'm really excited to get going again."
Moyes welcomed the permanent addition of a player he believes has plenty of room to develop.
"We're pleased to bring Tyrique back on a permanent basis. He made a positive impression during his loan spell with us last season and settled into the group quickly," Moyes said.
"He's still young and there's plenty of development ahead of him, but we believe he's got the attitude and the ability to keep improving. We're looking forward to working with him again and helping him fulfil his potential."