Sahin returned to Dortmund on loan from Real Madrid in January 2013 and has impressed manager Jurgen Klopp with a series of dynamic midfield performances.Dortmund reportedly had a clause in the loan deal that stated they could buy him at any time – and that is exactly what they did on Thursday.
After announcing the signing of striker Ramos from Hertha Berlin earlier in the day, Dortmund confirmed Sahin had permanently joined the club, for a fee said to be in the region of €7million.
"We met with Real Madrid officials when the two clubs played in the Champions League quarter-finals recently, and we have made it clear to them that we intend to make use of the option to buy," Dortmund chief executive Hans-Joachim Watzke told newspaper Ruhr Nachrichten.
The Turkey international came through the ranks at Dortmund, before departing in 2011 for Real Madrid.
An unsuccessful loan stint at Liverpool followed, before he joined Dortmund again.
The Bundesliga club have already announced the signing of Sunderland striker Ji Dong-Won, who is currently on loan at Augsburg.
Ji, like Ramos, will join Dortmund at the end of the season.
