Santos, 28, joins the Gunners from Turkish champions Fenerbahce, and will add some much-needed experience to an Arsenal backline which shipped eight goals in their humiliating defeat at Manchester United on Sunday.
Manager Arsene Wenger told the club's website: "Santos is a quality player, with the ability to both defend well and get forward and help with attacks.
"He has experience in the Champions League and for Brazil and has proven he can deliver at the highest level. We welcome Santos to the club and look forward to him having a big impact for us."
The Brazilian full-back, who did not feature in the 2010 FIFA World Cup™ squad, is understood to have joined the Gunners in a £6.2million deal.
Santos becomes the latest Brazilian to head to Arsenal, following the likes of Denilson, Sylvinho, Edu and Gilberto Silva.
"It was one of my dreams to play for a major European football club and I have accomplished this. I am very happy to be part of this team," he said.
"All the Brazilians who came to this club spoke wonders about it and I am delighted to be part of the Arsenal family."