The 20-year-old helped Huddersfield to promotion via the play-offs while on loan last season and the Terriers were understood to be keen to re-sign him.
Instead Brown will be playing in the Premier League for the newly-promoted Seagulls, and he could feature in a friendly against Southend on Tuesday night.
Albion manager Chris Hughton said: "The natural progression for Izzy, having enjoyed such a successful season in the Championship last season, was to step up to the Premier League - and we are delighted he will be doing that with us, here at Brighton
"He is a player with great potential and will bring a different dimension to our attacking options for the season ahead, alongside our existing strikers."
Brown is Brighton's sixth new signing of the summer following the arrivals of Pascal Gross, Josh Kerr, Mathew Ryan, Markus Suttner and Mathias Normann.
Source : PA
Source: PA