Valero was a club record arrival at The Hawthorns in 2008, but spent last season back in Spain with former club Real Mallorca.
"After relegation in 2009 we agreed to loan Borja to Real Mallorca," sporting and technical director Dan Ashworth told the club's official website.
"On the back of an outstanding season in Spain, and taking into account his professional and personal wishes, we decided to accept an offer from Villarreal.
"I'd like to thank Borja for his contribution and his professional attitude throughout the last two years. And we wish him well over the coming season."