Smith has joined the Championship outfit for an undisclosed fee as he seeks regular first-team football.
The 22-year-old – who has made just two appearances for Tottenham – has spent seven stints out on loan, including a season-long switch to Bournemouth in the 2010-11 season.
"It's great to be back," Smith told Bournemouth's official website.
"My loan spell here a few years ago was successful and I've worked with (manager) Eddie Howe before, so it just feels right.
"This is what I need because hopefully I will get some games to improve myself and help the club move up the table.
"I've had seven loans and I was looking to stay at one club for a while. At this stage in my career, I need to have a home."
Bournemouth manager Eddie Howe was delighted with the signing, adding: "We are really pleased to bring him in permanently.
"Our wish is always to sign young talent, develop it and make it better and I think Adam certainly fits that profile.
"A year ago, he was England Under-21's regular right-back so that shows what a good player he is."
Smith is not expected to feature in Bournemouth's home fixture against Huddersfield Town on Tuesday.
Bournemouth sit 16th in the table, seven points above the relegation zone.
