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Rafinha, a former Schalke player, arrives from Genoa. The double transfer was a move to strengthen a defense that was Bayern's weak point this season.
Bayern said Neuer would sign a five-year contract next week after returning from national team duty and passing a medical.
"I am looking forward with joy to the great and exciting challenge at Bayern," Neuer said in a statement. "Many national team players will now be my teammates in Bayern so it won't be such a novelty for me and I'll fit in quickly."
No details of the deal were given, but German media have widely reported that Bayern's bid was worth euro18 million ($26 million), plus an estimated euro7 million ($10 million) in bonuses linked to future Bayern successes.
"We are very pleased to have signed the No 1 goalkeeper in Germany but also one of the top 'keepers in the world to a long-term contract," Bayern chairman Karl-Heinz Rummenigge said.
Neuer, 25, helped Schalke win the German Cup and reach the semifinals of the Champions League this season. If he had seen his contract through, Schalke would get no transfer fee next season, when he would have become a free agent.
"This decision was very difficult for our club because we are losing an outstanding player," Schalke general manager Horst Heldt said.
"Under the circumstances, this was the best decision for Schalke."
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