The 19-year old has signed a four-and-a-half-year contract after being on trial at the club since December.
"(He's a) real box-to-box midfielder. He has fantastic drive and a fantastic mentality,” AZ sporting director Marcel Brands told the club’s official website.
"He made an excellent impression on us and he sees the Dutch competition as a good step in his development.
"This guy really wants to play. But we will let him mature quietly at Jong AZ."
Holland joins fellow Australian Brett Holman at the Eredivisie club.