The 21-year-old midfielder spent last season on loan at Nottingham Forest making 49 appearances, scoring four goals and providing 10 assists, playing a key part in their promotion back to the Premier League.
"I'm made up to sign for Everton. It's a huge step in my career and I want to help the team get better while progressing as a player."
Garner told evertontv. "I think Everton is the perfect place to do that. I can't wait to get started.
"The manager [Frank Lampard] has got a real plan for the Club and for me. Working with him on a daily basis is major for me. Him and his staff can take me and the team to the next level. That's what I'm hoping for.
"I know how passionate Evertonians are. I'm passionate myself and the sort of player who feeds off the crowd. I know what the fans are like so I think I'll be a good fit.
"I'm a box-to-box midfielder who can play in different roles and can support in defence and attack. I like to support with goals and assists but can do the hard work, too, which is equally important.
"I feel like I can bring real energy to the team - it is something that Everton definitely demands and I can add that in abundance. I have got quality as well so hopefully I can be a big part of us having a good season."
"I captained every team up until the first team at Manchester United and the same with England. It's a quality I definitely have.
"I'm still only young and there's a lot of leaders in the Everton team now, but it's something I've always had and I'm not afraid to speak my mind and lead by example.
"The Club has really high-quality players and I am looking forward to learning from them while contributing myself.
"My experience at Nottingham Forest last season, and how I improved as a player, has given me confidence I can perform at the highest level.
"I want to take that into the Premier League now and do it with Everton."
Manager Frank Lampard said: "James is a fantastic midfielder with a great all-round game who has qualities we know Evertonians will appreciate. We are really looking forward to working with him and having him add further strength to our squad."