It was reported earlier today that the 26-year-old was set to join Bradford’s League One rivals.
The winger missed the second half of last season with a serious knee injury but has completed a medical and has signed a two-year deal at Deepdale.
Reid joined the Bantams in 2011 and went on to made 110 appearances, scoring 13 goals. He was also a part of the team that reached the League Cup final and won the League Two play-off final in 2013.
Preston boss Simon Grayson told the official website:
“I have worked with Kyel before at Blackpool and Glynn (Snodin) has also worked with him, so we know a lot about him.
“He has been a big player for Bradford in the past couple of seasons and he’s the sort of player we have been looking to bring into the squad over the last few months.
“Kyel did his ACL cruciate ligament in January against Sheffield United. He is on his rehabilitation still at the moment, but we did an extensive two day medical and everything is fine.
“He is determined to come back fitter and sharper than he was this time last year, so we had no hesitation in doing the deal now and I am delighted that we have done it.”