The French striker has signed for The Red Devils until the end of the 2008/2009 season.
Fulham receive £11.5 million of the total expenditure and have already spent some of that revenue on Columbus Crew striker Brian McBride, as Chris Coleman prepares for life without his 15-goal top scorer.
"Louis is a young and exciting talent and has made incredible progress," stated Sir Alex Ferguson.
"We have got a young and gifted centre forward. His performances against Manchester United have showed us that.
"To have finally secured this deal is fantastic and is a great boost to the club."
Saha, who will wear the number nine shirt, had earlier admitted he was disappointed with the circumstances surrounding his exit.
"It's a dream come true," he beamed. "To leave a great atmosphere like Fulham has been difficult, but I am glad to be joining one of the best clubs in the world."
