The 30-year-old, who cost about four million pounds according to British media, is the latest high-profile player to leave Newcastle after they were relegated from the Premier League in May.
Forward Michael Owen has moved from St James Park to Manchester United while defenders Habib Beye and Sebastien Bassong have joined Aston Villa and Tottenham Hotspur respectively.
"I am happy my move to Fulham has been completed and look forward to joining in with the rest of the squad's training programme immediately in preparation for two important home matches this week," Duff told www.fulhamfc.com.
"Fulham had a fantastic season last year and I know having spoken to the manager (Roy Hodgson) in recent days the club's ambitions are high and I'm looking forward to the challenges."
Duff, who has 75 caps, made his name at Blackburn Rovers after his debut in 1997 before a 17 million pounds move to Chelsea in 2003 -- a record at the time for the west London club.
However, injuries disrupted his time at Chelsea and he joined Newcastle in 2006.
"I have known Damien for over a decade since he broke into the first team at Blackburn when I was manager, so I'm fully aware of his qualities and I am looking forward to working with him again," Fulham boss Roy Hodgson said.
