Striker Chawinga, 28, was the league's top goal-scorer last season while on loan at Paris Saint-Germain from Chinese outfit Wuhan Jianghan University.
Chawinga, who spent the previous season on loan at Inter Milan, scored 19 times in 21 league games for PSG as she became the first player from Malawi to play in the French top-flight.
"It was an ambition of mine to sign for a great club," Chawinga said in a Lyon statement.
"I hope to be able to inspire other people from Malawi to follow in my footsteps by playing here, in Europe," she added having signed a deal until 2027.
Lyon pipped PSG to the French title last season and beat the side from the capital city in the Champions League semi-finals before being beaten by Barcelona in the final.
Lyon women have won the French league 17 times and the Champions League on eight occasions.
