The 20-year-old centre back will stay at Ashton Gate until January 22 and goes straight into the squad for City's trip to high-flying Middlesbrough on Saturday.
The Scotland international moved from Rangers to Anfield in 2010 but has made just eight appearances for the first team and has not featured since Brendan Rogers took charge.
Wilson is no stranger to the Championship, having made 10 appearances for Blackpool at the end of last season.
Manager Derek McInnes said: "It's good to have another defender on board and certainly one of Danny's pedigree.
"We came up against him last season with Blackpool and I saw him playing for Rangers against my St Johnstone team before that.
"He's now got a chance to impose himself on our team and show what he can do. We've a lot of games to play between now and January, and with the absence of Lewin Nyatanga and Stephen McManus to injury, Danny's arrival is timely."
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