The 24-year-old has signed a three-year deal and becomes the latest Scottish recruit at Hillsborough for former Dundee United manager Paul "Luggy" Sturrock.
The former Scotland Under-21 international, who has opted to play for South Africa, left Livi in the summer when his contract expired at the end of last season.
Livingston owner Pearse Flynn tried to hang on to the star midfielder, offering him a contract worth £4000 per week.
O'Brien had been close to joining Hearts but decided to try his luck in England after new Jambos' boss George Burley wanted to see him on trial first.
O'Brien was regarded as one of the best left-sided players in Scotland and had been on the brink of a call-up to Walter Smith's national team.
However, South Africa are also keen to use him and were trying to establish whether that could be done despite his previous appearances for the Scotland Under-21 side.