The 29-year-old has put pen to paper on a four-year deal to keep him at Goodison Park until 2026.
Tarkowski ran down his contract at Turf Moor and was certain to leave even before Burnley were relegated. He had attracted interest in recent years from West Ham, Leicester, Aston Villa and Newcastle.
He became a target for Everton, who could be short of transfer funds after posting losses of £373 million over the last three financial years, and who lacked continuity in the centre of defence, when Yerry Mina was often injured and managers Rafa Benitez and Lampard tried a variety of combinations without finding a regular combination.
Tarkowski played at least 30 Premier League games in each of the last five seasons and helped Burnley have a better defensive record than Everton last season, despite finishing below them.
He said: “I think the manager recognised my strengths, saw how I could fit into his system and hopefully improve the team. He also saw my character and leadership skills - that what I can bring to a group will be good and positive.
“First and foremost, I’m a defender. That part of my game is something I’ve really worked on the past few years to become the best defender possible.
“I want to bring that to the team, but I also feel like I’m a good football player. I can move the ball well, I can pass, I can attack the ball in the other box, so I feel like I’ve got myself in a good place to be successful at a club like Everton.”
Everton director of football Kevin Thelwell said: “The statistics show that James has consistently been one of the Premier League’s most reliable defenders in recent years.
“James is a player I’ve admired for many years and Frank was very keen to bring him to the club.”