Ex-Blackburn keeper Friedel: O'Neill convinced me about Villa
While the midlands club are refusing to state the fee, it is believed to be around £2.5million.
The move brings to an end Friedel's eight-year association with Rovers, who he joined from Liverpool in 2000.
Blackburn reluctantly gave way to his request to leave in recognition of such long service.
And Friedel has now targeted a top-four place, telling his new club's official website: "Making this move was a very easy decision and a very difficult decision to make all at the same time.
"I've really got the feeling this club is going places and that's the main reason why I'm here."
Friedel added: "Martin was the main factor in my moving to Villa. I know a lot has been said about my Cleveland connection and my United States connection with Mr Lerner. I have spoken to him and he's a fantastic guy.
"But it was all down to Martin and the ambition of the club, also Martin's relationship with his chairman, the tremendous players here and the other players they want to bring in to make the squad bigger, stronger and better.
"Aston Villa were ever so professional in the manner that they dealt with everything and I couldn't be happier. I'm very pleased to be here.
"Hopefully things will go well for us this season. No one player ever makes a team but I'll just come in here and try to do the best I can.
"Hopefully we can improve on last year. Sixth was good but if we can move into fifth or fourth that would be fantastic."