The 24-year-old sealed his switch after impressing Town boss Mick McCarthy while training at Portman Road earlier this month.
And the midfielder has agreed a deal that will keep him with Ipswich until the summer of 2015.
Wordsworth progressed through the ranks at Colchester before making his first-team debut in August 2007.
He went on become a regular in the Colchester team and made almost 200 appearances, scoring 35 goals.
"I'm obviously delighted to be here. It's a big challenge and a big opportunity for me and I can't wait to get going," Wordsworth told the club's official website.
"I had opportunities to move last January but this feels the right time and the right club to make that step up.
"There was talk of other clubs being interested in me but Ipswich was the only club that I wanted to join and I'm delighted I have been given the chance to show what I can do."