The 24-year-old had attracted interest from across Europe after he helped his country to the knockout stages of the World Cup earlier this summer.
QPR boss Harry Redknapp said on the club's official Twitter account: "Eduardo is a quality player. He's sharp, he's bright, and he's very lively on and off the ball.
"He can play as a number nine, he can play in behind, he can play wide, he's very versatile."
The news of the deal to loan Vargas comes a day after Leroy Fer completed his move to Loftus Road from Norwich for an undisclosed fee.
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- Harry Redknapp