Biton has inked a four-year deal with the club, who on Thursday were drawn in a tough Champions League group with other former winners Barcelona, AC Milan and Ajax Amsterdam.
Celtic confirmed the signing on their website, saying that the club was "delighted" to announce that Biton has signed on a four-year deal.
"The talented Israeli internationalist has joined from FC Ashdod, which is also Efe Ambrose´s former club. The 21-year-old also joins up with fellow countryman, Beram Kayal at the home of the Scottish champions.
"He will be looking to play his part in Celtic´s UEFA Champions League group-stage campaign against Barcelona, AC Milan and Ajax."
Biton told the Daily Express on Friday, "The most important thing is I am playing for Celtic. This is all of my dreams – to play for a huge club like Celtic.
"I expect to be at my best and to prove to all of the fans and the people from Celtic that I am a good player and I expect to do well."