The Morocco forward has joined the Rossoneri for the rest of the season, despite having only joined Fulham on a season-long loan from relegated QPR last summer.
A statement from AC Milan read: "AC Milan announces that Adel Taarabt has joined on loan from QPR, with an option to sign the player at the end of the season."
The 24-year-old striker made just 16 appearances in all competitions for the Cottagers.
Taarabt becomes Milan's fourth reinforcement in the winter transfer window following the arrivals of Japanese playmaker Keisuke Honda from CSKA Moscow, French centre-half Adil Rami from Valencia and Ghanaian midfielder Michael Essien from Chelsea.
Taarabt is unlikely to make his Milan debut in Saturday's game against Torino.
Why? Just Why? When QPR got promoted to the P/L I had a conversation with someone at work, he thought Taarabt would set the P/L alight. I laughed and said he was able to look good in the Championship because the standards of defending and keeping are lower but that he's just not good enough for a top level league. Milan have a policy the last few years of signing lesser players instead of the world stars they used to sign, any wonder they're struggling in the league. Taarabt is just sh*t- shea666