The 37-year-old has signed a three-year deal following successful talks with Villa boss Martin O'Neill.
Rovers gave the move the green light after they signed Paul Robinson from Tottenham as a replacement.
Friedel made 287 appearances for Blackburn and was one of their outstanding performers last season.
Manchester City are thought to have made a late bid to sign the USA international, but Friedel opted to join fellow American keeper Brad Guzan at Villa Park.
Villa have agreed a deal with Chivas USA for 23-year-old Guzan, subject to a work permit hearing on Friday.
Scott Carson kept goal for Villa last season but O'Neill decided against signing the England keeper on a permanent basis from Liverpool and the 22-year-old has since moved to West Brom.
Friedel joined Blackburn from Liverpool in 2000 and though the club were reluctant to see him leave, they gave way to his request in recognition of his long service.
The move did not go through in time for the keeper to make his debut in Saturday's Intertoto Cup tie against Odense.
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