Lundh failed to score in five appearances for Lillestrom last season, having joined on an initial loan deal from AIK Stockholm in August.
The 26-year-old has won 11 caps for Sweden, scoring two goals.
"She is a hard-working striker who will offer us a real goal threat and I am delighted to have signed her," manager Scott Rogers told the club website.
Details of Lundh's contract with the Reds have not been disclosed.
Liverpool Ladies have signed Sweden international striker Emma Lundh from Norwegian champions Lillestrom SK.