The paperwork for the move was completed on Thursday afternoon on a three-year deal with the option of two further years.
The Premier League newcomers have apologised in the delay in confirming the transfer of the 24-year-old, which had been announced by Lokomotiv almost a week ago.
The club insisted they were unable to go public until everything was wrapped up for fear of "losing the player to another club at the 11th hour".
O'Connor said on Wednesday how excited he was to be joining Blues.
"I'm delighted to be back in Britain, for my family, to be back and happy and enjoying my football again," he said on Sky Sports News.
"It's a fantastic opportunity to play against the best players in the world.
"I'm going to take that with both hands now.
"I'm sure I can give a lot to Birmingham, I'm ready to listen to what the coaches have got to say and I hope I can work my way into the team and show I'm a good player.
"I'm looking forward to working with Steve Bruce and Eric Black, I'm sure they can bring things to my game.
"It's the right time for me to move back and to be moving back to the best league in the world."
He added: "It's the best move possible. My wife is buzzing. I'm just looking forward to us being a family again. I've missed my son growing up and want to enjoy the family."