Arkansas coach Bret Bielema announced the move Friday.
USC coach Steve Sarkisian announced Town's departure Sunday night. Town was a touted recruit from Ventura County who graduated from high school early to participate in spring practice with the Trojans. He was a centerpiece in their most recent recruiting class, widely considered the nation's best.
But Town faced stiff competition for playing time at USC. Senior Cody Kessler is heading into his third year as a starter, while sophomore backup Max Browne and fellow freshman Sam Darnold also are elite prospects.
Town will be eligible to play in 2016 for the Razorbacks.
Town verbally committed to Alabama two years ago, but changed his mind.