Despite approaches from Real Madrid and Inter Milan, Everton completed the deal today.
Rooney said: 'I'm delighted. It's a dream come true really - it means a lot, and I can't explain it.'
Everton also extended the contract of Tony Hibbert, both players are now with the club until at least 2006. The three and a half year deal for Rooney is the longest he is permitted to sign at his age.