The 25-year-old German was on the losing side in last season's UEFA Champions League against Frankfurt.
Blues have also brought in a player from the winners Frankfurt, German international forward Isabelle Linden.
They also signed Norwegian midfielder Andrine Hegerberg this week from Swedish side Kopparbergs/Gothenburg
"To sign Paris Saint-Germain's number one goalkeeper says it all," said Blues Ladies manager David Parker. "We have had to work hard to prise her away.
"It is another signal of intent and statement that we can attract the very best players to the club with the vision and strategy we have.
"When meeting Ann-Katrin and showing her everything we had to offer at the club she was blown away by what we are developing here and wants to be part of this special journey we are embarking upon."
The arrival of Berger, Linden and Hegerberg comes on top of the signings of Corina Schroder from Liverpool and Marisa Ewers from Bayer Leverkusen.
But Blues have lost two players, England internationals Jade Moore and Jo Potter having both opted to leave, after buying out their contracts.
Blues stand third in Women's Super League One, seven points behind leaders Manchester City, having gone into the mid-season break with two wins in three matches.
Birmingham City Ladies have made their third foreign signing of the mid-season break by bringing in Paris St-Germain goalkeeper Ann-Katrin Berger.