Since joining the Red Devils from Ajax in 2014, Blind has gone on to make 141 appearances for the club.
Blind returned to United for pre-season training but was left out of the squad which travelled to America on Sunday.
But United have sold the Netherlands global back to Ajax for an initial €16 million (£14.1m), which will rise to €20.5m (£18.1m) after bonuses.
But, since Mourinho's arrival, Blind has seen his playing time substantially decrease with the Portuguese coach seeming unsure as to his best position.More news: Conor McGregor's praise of Vladimir Putin draws scrutiny
Blind, who has 54 caps, won the FA Cup in 2016 plus the Europa league and League Cup last year but he missed out on United's FA Cup final defeat by Chelsea this year.
Blind was absent from United's travelling squad for their pre-season tour of the US on Sunday in order to complete his deal, and he trained with his new team on Monday as they prepare for a friendly against Wolverhampton Wanderers on Thursday. With Ajax he clinched four Dutch league titles.
"I'm really excited for this new challenge and my target is to meet the demands of the Premier League", the 26-year-old said on West Ham's official website.
Manchester United have already signed three players in the transfer window so far, but the club's first departure has now been confirmed. "He's multi-functional, can be a left-back, centre-half and a defensive midfielder".