Paterson, 26, a free agent after his contract with the Clarets expired, has put pen to paper on a two-year deal with the Terriers.
As is the case with fellow new arrivals Jon Stead and Adam Hammill, Huddersfield has an option on a further year's extension at the end of the initial contract.
"Martin represents another excellent signing to the group of forward players in the squad. In addition to his arrival, we will still be looking to add to our strike force as the summer transfer window progresses," said Terriers boss Mark Robins.
"I am a firm believer in putting round pegs in round holes and Martin has come to the club to play as a striker. He played three-quarters of his 41 games for Burnley last season in a wide position, but his career history shows that he has flourished as a central striker and that is the role he feels is his best. I agree and he will fulfil that role for us.
"Martin is a strong and resilient character with an excellent work rate which I think our supporters will really appreciate. That is backed up with good technical ability and, importantly, a proven track record of scoring goals at Championship level.
"He is a different type of player to those already here and will complement our other strikers and pose a different threat for opponents."
Robins added: "Our patience throughout the course of the closed season has really paid dividends this week with our three signings coming together.
"All three have chosen to join us over other Championship clubs for football reasons, and I believe that is testament to everyone at Huddersfield Town and the development of the club."
- Sports & Recreation
- Adam Hammill
- Mark Robins
- Jon Stead