As we reported previously, the 20-year-old right back has been with the Blue Square Premier League club having previously been with Leicester City and was a regular fixture in their side throughout last season.
Having played for England at under-17 level he played just once for Leicester whilst also enjoying loans at Tranmere Rovers and Kettering Town, but last summer decided to make the move to Mansfield to get some first team football.
He's done just that and he's done it well enough to have earned himself a move back to the Championship with the Clarets and manager Howe said after completing the move: "I am delighted to welcome Luke to Turf Moor. As a manager you always want players snapping at the heels of those wearing the shirts. To do that we need to build a squad. To be successful you need that strength in depth and Luke is a welcome addition.
"He is in the attacking mould and likes to get forward. He has a lot of assists to his name and although he prefers right-back, he can play in a variety of positions across the back. He brings that versatility and has huge potential. Luke is a player who has done it the hard way by dropping down to Conference level.
"He is hungry, has played for England at U17 level and has gained experience of league football at several clubs, so we look forward to working with him and hopefully improving him as a player."
O'Neill has signed a two year deal with the Clarets and is delighted to have got it all done and dusted. "I know this is a great club to be at and I can't wait to get going," he said. "I was at Leicester for six or seven years before joining Mansfield and it was unfortunate that I didn't' break into the first team there.
"I thought I could make an impact there, but it wasn't to be and since then I've been on loan to Tranmere and Kettering Town and gained valuable experience. Burnley have given me that chance and I've heard how they like to bring the young players through and I am so happy to be here.
"I'm coming here to try my best and get into the team. I know how difficult that is going to be, especially with Kieran Tripper at right back. He's a great player, but I'm up for the challenge."
The fee, as is the case with most transfers now, is undisclosed but suggestions are that we have paid around £200,000 for him.