The 27-year-old, brother of Liverpool's Xabi, will add depth to Sammy Lee's midfield ahead of the new 2007/08 campaign.
He moves from relegated La Liga side Real Sociedad and said about his move to the Reebok, "I am very happy about this new experience I am about to go through.
"It all happened very quickly. I was on holiday when my agent called and raised the option of going to Bolton. I regarded it as an exciting adventure and an interesting operation for Real, so I went on trial and my loan agreement was soon finalised."