The England Under-21 international has put pen to paper on a deal which will keep him at Villa Park until the summer of 2012.

Milner underwent a medical at Bodymoor Heath on Friday, and has made the move from the North-East for a seven-figure fee.

The 22-year-old could come into contention to play for Martin O'Neill's side against Liverpool at Villa Park on Sunday.

It is a case of O'Neill finally getting his man, two years after he had come within minutes of snapping up the former Leeds player.

Milner spent the entire 2005-06 campaign on loan at Villa, and a permanent deal was set to go through in August 2006.

But Newcastle pulled out of the deal at the 11th hour after failing at that stage to sign Mark Viduka.

Milner signed a new four-year contract last summer with the Magpies, but last week handed in a transfer request.

Villa, who are understood to have had an earlier bid rejected by Newcastle, have now moved swiftly to sign the right-sided player.

Magpies manager Kevin Keegan, who had repeatedly expressed his desire to hold onto the England Under-21 international throughout a protracted saga, revealed it was he who ultimately sanctioned the deal.

Keegan said: "He's a player, in an ideal world, you would not want to lose, but I just want to make it absolutely clear that at the end of the day, it was my decision to sell him.

"We got an offer that I feel was his value. We are all aware James has had a difficult time - he almost signed for them once before and was dragged back.

"But he has always behaved impeccably. He's a fantastic professional, and there's no doubt about it, they've got an outstanding player and we have got to move on."

The right of midfield has been a problem area for O'Neill, and Nigel Reo-Coker and Craig Gardner have been employed there to breach the gap.

Milner becomes O'Neill's seventh signing of the summer and will further bolster the squad after they booked a place in the first round proper of the UEFA Cup for the first time in seven years.