A new study put together from academic research group the CIES Football Observatory found that Liverpool's squad cost a total of €344m (£250.9m) in transfer fees - above Arsenal, on €304m, whose squad cost far less to assemble than other Premier League title rivals.
Squads belonging to Manchester City (€560m), Manchester United (€533m) and Chelsea (€407m) were the most expensive in the Premier League.
Arsenal (€305m) and Tottenham Hotspur (€231m), who finished above Liverpool in the Champions League and Europea League positions respectively last season, are calculated to have both spent less on their current crop of players than the Reds.
The most expensive squad in Europe belongs - perhaps unsurprisingly - to Real Madrid who are adjudged to have spent €587m on their collection of "galacticos" which includes the two most expensive players in history Gareth Bale and Cristiano Ronaldo.
Three clubs who have appeared in the last three Champions League finals - Borussia Dortmund (€142m), Atletico Madrid (€180m) and Juventus (€301m) - all have squads that cost less than both Liverpool and Arsenal's.
Liverpool manager Brendan Rodgers became the highest-spending manager in Liverpool history this summer after splashing out big sums on signings such as Christian Benteke and Roberto Firmino.
In contrast, Arsenal boss Arsene Wenger frustrated fans by reversing his recent trend of big spending and only signing goalkeeper Petr Cech during the transfer window.
See the top 20 most expensive squads in Europe according to the CIES Football Observatory below: