The deal includes an obligation for the Magpies to make the transfer permanent next summer based on performance-related criteria.
A boyhood Newcastle United fan, Lewis is the fifth arrival at St. James' Park this summer and will wear shirt number 20.
The 18-year-old full-back is regarded as one of Chelsea's most highly rated Academy graduates and has made 12 senior appearances for the Blues - including starts in both Premier League matches against Newcastle United last season.
He was named Chelsea's Academy Player of the Year for the 2022/23 season - just two years after Tino Livramento picked up the same accolade - and he was presented with the award on the pitch at Stamford Bridge before a 1-1 draw with the Magpies in May.
Lewis said: "I'm very proud. Me and my family are Newcastle fans, and for me and my brother growing up, it was drilled into us that we were Newcastle. It's a big club and I can't wait to get started.
"I got a lot of experience last year in some big fixtures and I was really proud of the way I progressed as a player and a person. To now be here at Newcastle, the club that I've supported since I was a kid, I'm honoured and very proud to wear this shirt.
"It's very exciting. When you look back on last season and the way the team performed - not just the results, but the performances the team were putting in - it was amazing.
"There's so many talented players and we've got the Champions League now as well so there's many different competitions that I know the team will be wanting to do well in, and hopefully get a trophy or two as well."
Newcastle United head coach, Eddie Howe, said: "I'm delighted to welcome Lewis to Newcastle United.
"He is a player we have tracked closely, as have a number of clubs, so it's very pleasing to secure him and to add a player of his quality, versatility and high potential to our squad.
"I'd like to thank everyone involved for their tireless work to bring in the players we have.
"A lot of time, effort and resource goes into a transfer window, but we have a real togetherness at all levels here and I appreciate that teamwork and support."
