Aspas, 26, netted just once during his time at Anfield after signing from Celta Vigo last summer.
A Reds statement said: "Liverpool have confirmed Iago Aspas has joined Sevilla on a season-long loan deal.
"The striker will spend the 2014-15 campaign with the La Liga club after a deal was finalised.
"Aspas joined the Reds from Celta Vigo in 2013. He made a total of 15 appearances in all competitions last season, scoring one goal."
The Spaniard had expressed his disappointment at his lack of first-team chances at Liverpool.
He said: "My experience in the Premier League was fabulous on a collective level, but on an individual level it was very hard for me, because I went from playing all the time to not playing at all."
The Reds will now up their effort to sign QPR frontman Loic Remy for £8m.
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