The 27-year-old has joined from Steaua Bucharest, and the Catalans have the option to sign the Romanian international permanently on a three-year deal should he impress.
Raducanu becomes the Primera outfit's third signing of the close season, following the arrivals of defenders Mauricio Pochettino from Bordeaux and Gregory Vignal from Liverpool.
Espanyol had been linked with a host of forwards in recent weeks including Rivaldo, Juan Sanchez, Marcelo Zalayeta, Mario Jardel and Facundo Sava, but boss Luis Fernandez has now pinned his hopes on Raducanu to grab the goals to fire his struggling side's bid to avoid relegation.
The Romanian bagged 21 goals for Steaua last season to finish top of the domestic scoring charts, and already has a further seven to his name this term.
