The Brazil worldwide, 24, will join the Champions League finalists on 1 July for around £39m (45m euros).
A further £4m (5m euros) could be included execution related extra installments and Fabinho's entry will probably be trailed by the flight of Emre Can.
"This is something that I generally needed - this is a goliath of a group," said Fabinho. "I am extremely energized."
The 24-year-old Brazilian is set to supplant Emre Can, who is relied upon to leave with his agreement terminating, and will play the 'No 6' part as the midfield stay for Jurgen Klopp.
The arrangement is a piece of a critical enrollment drive by Liverpool, who are focused on marking midfielder Naby Keita from RB Leipzig for €55m, are in converses with purchase Lyon assailant Nabil Fekir for around €65m and will make another endeavor to sign Roma goalkeeper Alisson for a comparable sum.
In the event that every one of the four arrangements are finished, it would mean a cost far in abundance of €200m for Liverpool, who got €150m from Barcelona for Coutinho in January, days after they broke their exchange record by marking Virgil van Dijk for €80m.
All things being equal, amid his three years at Liverpool, Klopp has viably made back the initial investment in the exchange showcase and has cash to spend now.
After the arrangement was declared, Fabinho stated: "I am extremely amped up for this move. This is something that I generally needed - this is a monster of a group. The frameworks of the club look extraordinary.
"A football club of this size coming after my administrations, I didn't need to contemplate coming over. I will attempt to develop and learn and enhance myself, and to be a piece of the club's history."
Liverpool have been keen on Fabinho for quite a while and were among a large group of clubs - including Paris St-Germain and Manchester United - to make a request the previous summer, when they likewise attempted to sign winger Thomas Lemar.
The two players were advised by Monaco that they needed to remain for another season.
The Fabinho bargain speaks to something of an overthrow for the club.
Liverpool's strong move is an indication of their desire, having achieved the Champions League last, losing on Saturday to holders Real Madrid. The absence of quality inside and out in the Liverpool squad was uncovered in that match.
Can was on the seat against Real at the same time, with his agreement running out on June 30, he is because of leave Liverpool and is relied upon to sign for the Italian champions Juventus. A declaration is impending.
Fabinho has had another great season with Monaco and is a flexible player who can perform anyplace over the midfield and at full-back, in spite of the fact that Klopp has recognized him as a guarded midfielder.
Fabinho at first joined Monaco on a season-long credit in July 2013 after a disillusioning spell with Real Madrid, where he played only 14 minutes, and has earned four tops for Brazil however isn't in their squad for the World Cup.
Klopp was at that point considering another goalkeeper before Loris Karius' catastrophic slip-ups in the Champions League last and his first decision would be Alisson.
Conditional request for the Brazilian global were repelled before this season, however a crisp exertion is currently anticipated from the Anfield club.
'He can play six, eight and two - this is cool'
Fabinho has spent spells playing as a right-back yet has exceeded expectations in cautious midfield and is seen as a swap for Can, who is out of agreement this mid year and has over and again been connected with Juventus.
Chief Jurgen Klopp stated: "He has capacity and attitude to play at the most abnormal amount in various positions. He can play 'six', 'eight' and 'two'. This is cool."
The Brazilian, whose arrangement will start on 1 July, said the club's foundation looked "extraordinary".
"A football club of this size coming after my administrations, I didn't need to ponder coming over," included Fabinho.
"I will attempt to make my own particular history at this football club. Ideally, on an individual level, I'm ready to win titles with this club."
'Liverpool are increasing a few players in one'
Fabinho, who joined Monaco on credit from Portuguese side Rio Ave in 2013, won the French class title in 2016-17.
He has included intensely for the club since influencing his credit to move perpetual in 2015, playing 47 times in all rivalries last season and scoring eight objectives.
Taking all things together, he showed up and scored 29 objectives in five seasons with the French club.
"We have marked an incredible player, however somebody who is a similarly fabulous individual I think," included Klopp.
"His notoriety for being a character in the changing area and his state of mind in preparing has come through from everybody we address.
"He has a stunning family likewise - adding a man like this to our changing area just makes us significantly more grounded. What we have - as far as our condition at Melwood and in the group - implies anybody coming in must be of that assemble. They should be the most noteworthy quality individual and player."
Regardless of helping Monaco to second in Ligue 1 behind champions Paris St-Germain last season, Fabinho did not influence Brazil's 23-to man World Cup squad.
He will join another new face in Liverpool's midfield next term, with Guinea worldwide Naby Keita moving to Merseyside from RB Leipzig on 1 July.
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