The midfielder had already signed a pre-contract agreement to join Spurs on a free transfer in the summer but the clubs have now agreed a fee to accelerate the move before the close of the January transfer window.

Tottenham chairman Daniel Levy has been locked in talks with Schalke general manager Horst Heldt over the last two weeks before finally agreeing a deal on Sunday night as the Londoners look to bolster their squad to aid their push for a top-four finish.

Schalke are on the verge of signing Brazilian midfielder Michel Bastos from Lyon and had been keen to recoup a transfer fee for Holtby, whose contract with the German club expires at the end of the season.

Spurs manager Andre Villas-Boas had played down the prospect of Holtby arriving at White Hart Lane earlier than scheduled but had privately been eager to bring in the 22-year-old following the knee injury that has ruled out Sandro for the rest of the season.

Holtby's early arrival could mean that Tom Huddlestone or Jake Livermore leave on loan before the transfer window closes on Thursday night.

"We are delighted to announce that we have reached agreement with Schalke for the immediate transfer of Lewis Holtby," Tottenham said on their website.

"We have found the best solution for everyone involved," said Heldt.

"Lewis had indicated to us that he would not be averse to change prematurely, and five months before the expiry of the contract FC Schalke 04 has still got a decent transfer fee.

"He has always behaved correctly and worked superbly until the last day for Schalke. We wish Lewis all the best and good luck for the future. "

Spurs announced earlier this month that they had reached an agreement with Holtby having tracked the Germany under-21 captain for a month and beaten bitter rivals Arsenal to his signature.

The move will see him leave Germany for the first time after spells with Alemannia Aachen, Bochum and Mainz before moving to Schalke in the summer of 2009.

Holtby, who has an English father and is a lifelong Everton supporter, has made 79 appearances in all competitions for Schalke and has scored 13 times for the club, while he has also earned three caps for the senior German national side.