A victor of the 2010 World Cup and two European Championships with Spain as well as boasting 789 professional matches at club level - 395 of which came at Liverpool - Reina brings with him an enormous amount of experience.
Dean Smith, the team's manager, is said to be delighted with the move, saying that he has a "wealth of Premier League experience".
"Early in the summer we were looking for an experienced goalie and brought Tom Heaton". We need to play with discipline and remain determined.More news: 'Silence of the Lambs' Sequel Series 'Clarice' in the Works at CBS
English worldwide Heaton suffered a knee injury during Villa's 2-1 victory in Burnley on New Year's Day.
"Unfortunately, his injury has excluded him for the rest of the season, but Pepe meets our criteria not only because of his experience but also because of his leadership qualities".
Milan, who have resigned Swedish striker Zlatan Ibrahimovic this month, are tenth in the Serie A table 23 points behind leaders Juventus, and ten points adrift of the Champions League places.More news: Ethnic minorities and women mostly miss out while 'Joker' tops Oscars list
Reina, 37, watched Villa's 6-1 loss to Manchester City on Saturday from the stands.
He has pushed to join Villa after making such five league appearances among 13 in all competitions during two seasons at Milan.
Start your day with Good morning transfers at 9 in the morning while our team of reporters brings you the latest news and knowledge. He lasted just one year at the Allianz Arena before returning to Napoli for three years.More news: Talks underway to rescue Flybe