The 23-year-old joins for an undisclosed fee and has signed a five-year contract with the Magpies.
Yedlin spent last season on loan at Newcastle's bitter rivals Sunderland, where he played 25 times.
Upon completing his move to St. James' Park, the American told the club's official website: "Newcastle is such a big and historic club, and I'm excited to have the honour of playing for them. Hopefully I can do great things here.
"I'm excited to learn under Rafa Benitez as well. He has an amazing résumé and I know he will help improve me a lot.
"I can't wait to get started".