"We felt the time was right to be aggressive and add another bat," general manager Dayton Moore said.
In exchange, the Twins acquired right-handed pitching prospect Jason Adam, who had been with Triple-A Omaha.
To clear room on the 40-man roster, the Royals requested unconditional release waivers on Omaha pitcher Wilking Rodriguez. The Royals must make another move on Tuesday, dropping a player from the 25-man roster.
Willingham, 35, had a .210 average, 12 home runs, 34 RBIs and a .345 on-base percentage for the Twins with 42 walks in 278 plate appearances in 68 games.
"We claimed him when he went through waivers and we were able to execute a deal," Moore said. "Josh is a proven bat, one of the best on-base guys with 250 plate appearances right now in the game."
The deal came as the Royals were within a half-game of first place in the American League Central and had won seven straight games.
Willingham has spent the last three seasons with the Twins and in 2012 won the AL Silver Slugger Award as a left fielder, belting 35 home runs with 110 RBIs. He's also played for the Marlins, Nationals and A's in his 11-year career.
A right-handed hitter, Willingham helps fill the DH void left when Billy Butler switched to first base full-time after Eric Hosmer went on the disabled list with a hand injury on Aug. 2.
"He'll be in the lineup most days as we're set up right now. [Manager Ned Yost] will ultimately make that call and how it matches up," Moore said. "But we see his presence in the middle of our lineup somewhere and a presence that can get some big hits for us. He had a big hit yesterday, actually, against Oakland. So he's a professional and a winner."
Willingham belted a two-run homer in the Twins' 6-1 win on Sunday, his first blast since July 30.
Moore indicated that Willingham and left-handed-hitting Raul Ibanez would not form a strict platoon in the DH slot.
"With the DH spot being somewhat fluid for us right now, we feel that he can complement that role very well," Moore said.
Willingham has played 53 games at left field and 13 at designated hitter this season. He has not played any other position since 2009.
"We talked about needing a veteran right-handed bat, and he fits that bill perfectly for us," Yost said. "We'll mix and match, but he's going to be involved pretty much every night."
The Royals will pick up about $1.8 million of what remains from Willingham's $7 million contract this year. He is in the final year of a three-year, $21-million deal signed with the Twins.
"If we find players that make sense, Mr. [David] Glass has always been willing to add a piece that we think can help us win and we think that Josh is the right presence in our clubhouse and in our lineup right now for what our team needs," Moore said.
Adam, 23, from Overland Park, Kan. has a 4.67 ERA in the Royals' farm system this year. He began the season as a starter at Double-A Northwest Arkansas, before being promoted and working out of the bullpen in all eight of his games for Omaha.
"He's a quality pitcher, a great person and he's got a great arm. He's going to be a quality Major League pitcher," Moore said. "He's in Triple-A right now but you've got to give up something to get something. That's the nature of the game. Jason's a terrific pitcher and he's got a great career ahead of him."
Rodriguez, 24, had a combined 2-1 record and 2.36 ERA in 24 games this season for Omaha and Northwest Arkansas. He was called up to Kansas City on June 2 and pitched in two games with two scoreless innings before returning to Omaha.
The Royals passed through the July 31 Trade Deadline without making a move.
"We want to be aggressive all year but, at the deadline, we didn't feel there was anything that made a lot of sense for us at that particular time," Moore said. "We were virtually in on every player and weren't really caught off guard on anybody that was moved and just couldn't come to agreement on deals that made sense."
The Royals aren't sure when Hosmer might be back. He was expected to miss anywhere from three to six weeks.
"We don't really have a timetable. It's not like you're going to be able to send him out on a rehab assignment - the Minor Leagues are probably going to be over," Moore said. "He'll be back at some time but it's hard to predict when that'll happen. He was obviously swinging the bat very well when he got hurt but we have to deal with what we have healthy at the time."