The 18-year-old, who played eight times for Rovers in the Championship last season, has signed a five-year deal.
He joined Blackburn aged 12 in 2017 and progressed through the academy before making his first-team debut in 2022.
Tottenham activated his £2m release clause and the defender becomes their sixth summer signing under new manager Ange Postecoglou.
They have also recruited England midfielder James Maddison for £40m from Leicester City and Italian goalkeeper Guglielmo Vicario from Serie A side Empoli, while Israel winger Manor Solomon joined on a free transfer after leaving Shakhtar Donetsk.
Loan deals for Sweden forward Dejan Kulusevski from Juventus and Spain full-back Pedro Porro from Sporting Lisbon have also been made permanent.
"I've matured so much at a young age and it really means a lot," said Phillips as he thanked Blackburn for developing his talent.
"Blackburn Rovers will always have a place in my heart and I wish the club all the best going forward."
Phillips has been a regular in England's youth set-up since he switched his allegiance from Wales in 2021 and he captained England Under-18s against Norway in June.
Tottenham's 2023-24 Premier League campaign begins away at Brentford on Saturday, 13 August.
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