Predominantly a full-back, Fosu-Mensah can operate as a defensive midfielder or centre-back, which will help the Cottagers throughout the season. Newly promoted Fulham beat competition from Bundesliga side Hertha Berlin for his services, sources told ESPN FC.
However, he spent last season on loan at Crystal Palace playing some 21 times without scoring.
"It's an important change for me because this is my first experience here in England".
His performances attracted the attention of Atlético Madrid, who signed him in 2015, before loaning him out to Sevilla and then Valencia.
Pinchi was originally signed by Atletico to help their B team get into the Segunda Division but, according to the Daily Mail, the Spaniard is due at Fulham today.
"Sergio joins a very talented cast of goalkeepers under contract at FFC, and he answers our mandate of making our squad the strongest and deepest it can be as we face top Premier League opposition", Fulham's director of football operations Tony Khan said in a statement.
He did manage a hat trick against Las Palmas in the Copa del Rey in January, and now will be seeking more consistent form as he moves to London.