Sitting at a round table in the Kremlin at a televised meeting, Mr Putin showed the Hollywood actor where to sign the passport.
They then rose and shook hands with Mr Putin saying briefly: "I congratulate you," and Mr Seagal answering in Russian: "Spasibo bolshoye," or thank you very much.
The Kremlin released a transcript of their chat, with Mr Putin saying that they had been discussing citizenship for "quite a while" and agreed it must be an "absolutely depoliticised act."
Mr Putin said he hoped that adding Mr Seagal to the list of celebrities who have gained Russian citizenship in recent years could be seen as "a sign of gradual normalisation of the relations between our countries."
Mr Seagal called the passport a "great honour," while Mr Putin responded by telling him he hoped "our personal relationship will remain and continue."
Mr Seagal is the latest in a string of high-profile Westerners to be granted Russian citizenship after buddying up with Mr Putin.
Mr Putin has also handed out citizenship to US boxer Roy Jones Junior after sipping tea with him in Crimea and to American mixed martial artist Jeff Monson.
Mr Seagal's fame peaked in the late 1980s and early 1990s with films such as "Under Siege" and "Above the Law", but he remains hugely popular in eastern Europe and was granted Serbian citizenship in January.
Like Mr Depardieu, he has previously hung out with Mr Putin, a fellow martial arts fan, and other strongmen leaders from the former Soviet Union.
After Russia's annexation of Crimea, Mr Seagal called Mr Putin "one of the great living world leaders" and even performed with his blues band in the annexed Black Sea peninsula.
In August, veteran Belarussian leader Alexander Lukashenko made Mr Seagal eat one of his homegrown carrots in an awkward encounter that drew mockery online.