The 20-year-old spent loan spells at First Division side Watford but is struggling to break into Arsenal's first-team.
Leeds chairman Professor John McKenzie told club's official website: "We are delighted that Jermaine Pennant has agreed to join Peter Reid's squad, we believe he could be an excellent addition."
Manager Reid added. "He will be another body. We are a bit short in the squad, it will be a great help."
He joined the Gunners from Notts County in a £2m deal as a 15-year-old.
Pennant made his Arsenal debut in a Worthington Cup tie against Middlesbrough in November 1999, at the age of 16.
His international career was under threat as he upset David Platt after ignoring a curfew while away with the U-21 squad.
He had just two starts for the Gunners in the 2002/03 season, but made a big impression as he scored a memorable hat-trick in Arsenal's final home game of the season against Southampton.