The French club was linked with this move for quite a few weeks now but initially offered only £14m and it hasn't met the Newcastle expectations.
The French champions said in a statement: ‘Paris St Germain is delighted to announce the transfer of Yohan Cabaye to the capital club from Newcastle United until June 2017. He will wear the number four jersey.'
Cabaye said of his move: ‘I was won over by the ambitious project at Paris St Germain and I can't wait to join this exceptional squad and help the team reach its objectives in France and in Europe.
‘I want to thank everyone and Newcastle for allowing me to make this move. It was difficult to turn down such a huge club. Newcastle respected the agreement we had to allow me to leave this January. I had a wonderful time over there, I want to thank the manager, the staff.'
‘I am very, very happy to return to France.
‘The offer from Paris St Germain was hard to refuse, I want to win titles and PSG offer me that so it is an ideal club. I did not hesitate.
‘I am proud to have a chance to be a part of this ambitious project, to have the opportunity to win titles and play in the Champions League.