The 27-year-old will join up with the Championship club in Dublin ahead of Friday night's friendly against Dundalk.
Proschwitz has struggled to hold down a regular place in Hull's starting line-up since arriving from SC Paderhoen 07 for £2.5m in the summer of 2012.
He has made just six appearances for Steve Bruce's side this season, scoring two goals.
In total Proschwitz has made 37 appearances for the Tigers and has scored seven goals for the club, but he has started only five league games.
Barnsley manager Danny Wilson told his club's official website: "His experience is something that will help us now, rather than getting a younger player in, and he is someone who will be able to hit the ground running.
"I think Nick and Chris (O'Grady) will be able to feed off each other quite well. He is a player who does like to score, he can get into the box well and he is a good finisher.
"Hull have been fantastic with us in getting this deal done and I can only say thank you to them for that and hopefully a big thank you at the end of the season.
"Nick seems very positive and he is not fazed by the position we find ourselves in. In fact it's quite the opposite, he feels very confident he can get the goals that will help us out."