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The Netherlands international has signed a contract at Leipzig until 2027.
Media reports said the deal was worth over €50 million plus significant add-ons.
“I have always emphasised that I feel very much at home in Leipzig and am honoured by the great appreciation I receive at the club,” Simons said in a statement shared by Leipzig.
Simons joined PSG as a youth player in 2019 after seven years at Barcelona.
He made his senior debut at the French club in 2021, and moved to PSV Eindhoven the next year, before returning to PSG in 2023.
PSG sent Simons on a loan to Leipzig shortly after his return.
The 21-year-old has also made 24 appearances for the Netherlands, and helped Leipzig win the German Super Cup in 2023.
He has made 60 appearances for Leipzig over the last two seasons, scoring 15 goals.
“We want to qualify for the Champions League for the seventh time in a row and travel to Berlin in the (German) Cup, that’s all that matters now,” Simons added.
Leipzig are in the German Cup quarterfinals and sit fifth in the Bundesliga, trailing fourth-placed VfB Stuttgart on goal difference as they look to secure a top four finish and Champions League qualification.
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