The 21-year-old centre-half has spent his entire career with the Old Trafford club but has joined the Hatters in search of regular football.
He told Luton's website: "I’d been at Manchester United since I was six and been there all my life; I’ve seen people come and go and I was the last of my age group to leave. While it’s sad to leave United, it’s an exciting time.
"I just had to be real with myself and ask what’s going to be best for me. Stay and fight with United or go somewhere else and look for an opportunity. In the end I was honest with myself and took that option.
"Making Luton my home was a no brainer and taking on that challenge as I’ve never lived outside of Manchester is something I’m looking forward to.
"Even before they got promoted the team were doing well. I like the way they play and with five at the back I feel I could fit in very well. After speaking to the manager, I feel as though I’ve got a good chance of making an impression here."