The 25-year-old has signed a four-year contract at King Power Stadium and becomes the Foxes' fourth summer signing after the arrival of attacking midfielder James Maddison, Northern Ireland worldwide defender Jonny Evans and Portuguese full-back Ricardo Pereira.
Liverpool have had issues in goal for a number of years, and Loris Karius not only endured a nightmare showing in the Champions League final against Real Madrid in May, but has also struggled in pre-season.
But the expected arrival of Alisson in a deal worth €75 million has changed the landscape considerably.
Although initially seen as a replacement for Kasper Schmeichel, Ward has been brought in to provide competition to the Dane after the sale of Ben Hamer.
Ward becomes Leicester's fourth signing of the transfer window, following James Maddison, Jonny Evans and Ricardo Pereira to the club. Nabil is considered one of the most exciting attacking prospects at the CFA in a long time, but at the age of 17 a spell in the Championship may come a year or so too soon for him.
Speaking to lcfc.com, Ward said he is "delighted" to have signed for Claude Puel's Foxes and that he is "really looking forward" to the future. And the former Wrexham youngster is eager to get started with the blue of Leicester next season, stating: "I've come here to develop my all-round game and hopefully help deliver some more success".
Ward played for Liverpool since 2012, but only made three official appearances in the first team.
The England worldwide was loaned to West Brom for the second half of the season in a bid to recapture his form.