Markovic had returned from his disastrous loan spell at Sporting Lisbon this month and was expected to be sent back out by the Merseyside club.
Liverpool signed Markovic in 2014 but the Serbia international struggled for game time at Anfield.
He went on loan to Fenerbahce last season before joining Sporting for the first half of this campaign.
— Hull City (@HullCity) January 23, 2017
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Liverpool have sent Lazar Markovic on loan to Hull
Markovic will remain at Hull until the end of the season
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Liverpool and Sporting cancelled the loan deal so that Markovic could move back to the Premier League, having played just 11 games for the Portuguese side.
The 22-year-old is Hull manager Marco Silva’s second signing of the January transfer window after Evandro Goebel arrived from Porto.