Szalai moves to the Rhein-Neckar Arena on a four-year deal after just one season with Schalke.
The Hungarian joined Schalke from Mainz in June last year and featured relatively regularly, making 40 appearances in all competitions.
Szalai found the net just nine times, however, and has evidently not done enough to convince Schalke to keep him at the Veltins Arena.
He will now try to make a better impression with a Hoffenheim side that finished ninth last term following an inconsistent campaign.
But Szalai may have a fight on his hands to earn regular playing time with Markus Gisdol's side, given that strikers Kevin Volland and Anthony Modeste and attacking midfielder Roberto Firmino all hit double figures in the previous campaign.
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