The Netherlands international, who can play along the right flank, has penned a three-year contract after Liverpool activated a €35 million (£29.5m) release clause.
The Reds' move to snap up Frimpong quickly comes with the knowledge of Trent Alexander-Arnold departing Anfield at the end of the season to join Real Madrid.
The 24-year-old's career started as a youth player at Manchester City before joining Celtic in 2019, then moving on to Leverkusen in January 2021.
He emerged as a key figure at Leverkusen under Xabi Alonso, helping the club win the Bundesliga unbeaten last season and the DFB-Pokal.
Frimpong has made 190 appearances in total for Leverkusen, recording 30 goals and 44 assists during his stint in Germany.
Frimpong's former club Celtic are said to be owed a portion of the transfer fee, with Sky Sports reporting the figure could be worth around £5 million.
Liverpool are also showing an interest in Frimpong's former Leverkusen teammate Florian Wirtz and, according to sources, have made a massive bid for the playmaker.
Wirtz, who could command a transfer fee exceeding £120 million, has already snubbed Bayern Munich this summer, while Manchester City have pulled out of the running.