Keppie's arrival bolsters a forward pack that lost Hame Sele and Jed Cartwright following Souths' demise from ladder-leaders in round 11 to ninth at the finish.
He has signed through to 2026, joining Thomas Burgess, Shaq Mitchell, Junior Tatola and Jai Arrow as options in the middle as Jason Demetriou's side plot a recovery.
Keppie has played all 79 of his first-grade games for the Sea Eagles since making his NRL debut in 2019.
But after Manly finished 12th in 2023, they gave him permission to look elsewhere, despite extending his contract to the end of 2026 only last October.
Keppie, 25, is the second recruit signed by the Rabbitohs for 2024 after they landed former representative star Jack Wighton.
"We've been watching Sean for a number of seasons and he has developed into a strong frontrower with controlled aggression in both defence and attack," said Rabbitohs head of football Mark Ellison.
The signing continues a busy off-season at the transfer table for the Sea Eagles, who are continuing to reconfigure ahead of Anthony Seibold's second season as coach.
Luke Brooks, Corey Waddell, Jaxson Paulo, Tommy Talau and Aitasi James are all joining Manly as Latu and Samuela Fainu, Kelma Tuilagi, Morgan Harper and Kaeo Weekes depart.
Keppie's exit comes as the Sea Eagles prepare to confirm the signing of former NSW State of Origin forward Nathan Brown, whose Sydney Roosters contract expired at the end of 2023.
Manly are also poised to offer a long-term deal to Haumole Olakau'atu, their highly rated right second-rower currently under contract until the end of 2025.
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