The 33-year-old passed a medical late last night and will now join Diego Simeone's squad, serving principally as back-up to Thibaut Courtois.
"I'm very happy to join a big team like Atletico Madrid. I've come to start working," he said on Atletico's official website.
"I am aware that Atletico Madrid has a great goalkeeper but I've come to do my job, to compete and try to help the team do well.
"I hope to work, do things right and help Atletico Madrid."
Aranzubia has made over 300 appearances in a career which has taken in Athletic Bilbao and Deportivo, while he has also played for the Spanish national side.