The 27-year-old leaves Anfield as a free agent after Liverpool and his camp failed to close the gap over his value and wages, ending a five-year stay on Merseyside.
Real Madrid confirmed the move in a statement.
"He will become a Real Madrid player for the next four seasons, until 30 June 2030," the club said.
Konate joined Liverpool from RB Leipzig in 2021 for £35m on a five-year deal and went on to make 183 appearances in all competitions for the club.
He won the Premier League, the FA Cup and two League Cups during his time at Anfield, establishing himself as a regular alongside Virgil van Dijk in central defence.
Konate is currently away with France at the 2026 World Cup.
Before linking up with the national team, he spoke about his final appearance for Liverpool, in the 2-1 win over Brentford on 24 May that closed out the Premier League season.
"I didn't know it would be my final time wearing this shirt in front of you," he said.
He added that he had been deeply saddened not to get the chance to say goodbye to supporters that day.
Real Madrid have been tracking Konate's situation for months and moved quickly once his Liverpool exit was confirmed, adding a Premier League winner to their defensive options at no transfer cost.
Bayern Munich, Barcelona and several Saudi clubs had also registered interest in the centre-back, but Real Madrid were the first to make a concrete approach once it became clear he would not be staying at Anfield.
The deal continues a recent pattern of Anfield players heading to the Bernabeu, with Konate set to link up with France team-mates Kylian Mbappe, Aurelien Tchouameni, Eduardo Camavinga and Ferland Mendy, who are already established in the Spanish capital.
Liverpool have already moved to address the gap in defence, agreeing a deal to bring in countryman Jeremy Jacquet from Rennes this summer.