The 22-year-old goalkeeper has not made an appearance for Atletico since joining them in summer 2014, and is hopeful for more gametime.
The Portugal U21 spent the last three seasons on loan, spending time at Moreirense, Uniao Madiera and Belenenses.
He made his first appearance for Villa in a behind-closed-doors friendly against Stoke City earlier in the week.
He's expected to compete for the No 1 spot with Jed Steer for the coming season.
Speaking about his move, he told 'Sky Sports':
"I am very excited. It's such a big opportunity at such a big club. It's the perfect opportunity at the right moment. It's a big move for me."
"Aston Villa is a great football club - a famous football club."
"The training facilities are great. I know the stadium is famous and historic. I just can't wait to get started now."