Cottagers boss Martin Jol has been looking to strengthen his defensive options after watching his side drop into the bottom half of the Premier League table.
Although Manolev’s move is scheduled to finish at the end of the current campaign, the Londoners have an option to extend the deal for up to two years.
The Bulgarian international is able to play at both left and right back, and will help to replace Stephen Kelly who moved Reading earlier this month.
The 29-year-old has spent three-and-half seasons with PSV, but has fallen out of favour with the Dutch side of late.
He is the second arrival at the club today, with Fulham having already secured a loan deal for AC Milan’s Urby Emanuelson.
The Dutchman, who can play at ether left midfield or left-back, will further boost Jol’s options.
Despite having secured two new players, Fulham are still believed to be in the market for a new striker.
Bolton’s David N’Gog, formerly of Liverpool, is thought to be their top target.
They have also been linked with Tottenham’s Tom Huddlestone and Roma goalkeeper Maarten Stekelenburg.