Gunners manager Arsene Wenger moved for Källström on Friday as he looked to add depth to a midfield hit by injuries to Aaron Ramsey and Jack Wilshere and Mathieu Flamini's suspension.
The 31-year-old, who has also played for BK Häcken, Djurgårdens and Rennes, has a wealth of experience at the highest level after starring at French club Lyon.
Källström made over 200 appearances for Lyon, winning the Ligue 1 title twice and helping the club reach the Champions League semi-finals in 2009-10.
He has also won 108 caps for Sweden and appeared in the European Championships in 2004, 2008 and 2012, as well as the 2006 World Cup.
Wenger believes Källström's impressive pedigree will make him a valuable addition as the Gunners, currently second in the Premier League, look to end their long trophy drought
"Kim Källström is a hugely-experienced player," Wenger told Arsenal's website.
"He is a midfielder with proven quality at both club and international level. We welcome Kim to Arsenal."
Although Källström has appeared for Spartak Moscow in this season's Europa League at the play-off stage, when they were eliminated by Swiss club St Gallen, Arsenal say he will be eligible for the Gunners for the remainder of this season's Champions League campaign.
With a potentially thrilling end to the season in prospect, Källström is determined to help Arsenal finally win silverware after an nine-year drought.
"Arsenal is an amazing club with a lot of great players and a coach who has done really well here for a long time,"Källström said.
"I am so pleased to come here to learn as much as possible. I'm here to do my best for Arsenal and to help out the team, so we can achieve good results for the last part of the season."
Previous Swedes to play for the Gunners include Anders Limpar (1990 - 1994) and Freddie Ljungberg (1998 - 2007) who was a member of Arsenal's 'Invincibles' of 2003/04.