Balogun had been linked with a switch to Huddersfield Town, but the Nigerian international has instead opted to link up with the Seagulls.
The 59-year-old told the club's official website: "I am delighted to welcome Leon to the club. He will add more depth to our defensive options, and I am pleased to get our first piece of business done so early in the summer.
"He is in the peak years of his career and I am sure he will integrate well into the squad. He also has valuable experience, having played in the Bundesliga, the Europa League and at international level."
Balogun has been named in Nigeria's provisional squad for the World Cup.