Personal terms with the 25-year-old have been concluded and the deal has been ratified by the Premier League and the Football Association.
After a medical Carlos, who has won the league title in every country in which he has played, is expected to sign a five-year contract and will meet up with his new teammates on their pre-season tour to South Africa. He will sport the number 32 shirt.
The only player to named South American Player of the Year in three successive seasons, Carlos has recently concluded a summer break following his successful World Cup exploits with Argentina.
"It is terrific news," a delighted Mark Hughes told mcfc.co.uk. "Carlos is an international player of the highest class who possesses all the attributes that will help drive this club forward.
"He is not only outstanding technically but he is a reliable goal scorer and someone who will contribute fully to the team ethic. He gives us another exciting, attacking dimension.
"I cannot wait to welcome him to City. This is yet another deal that shows the commitment of the owner Sheikh Mansour to make this club the very best it can possibly be. I am sure our fans will give Carlos an exceptionally warm welcome."
Tevez signs after an extended loan spell at Old Trafford where he spent two seasons and clocked up 99 league and cup starts and bagged 34 goals.
He has previously spent a season at West Ham United having made his name in his homeland with Boca Juniors before transferring in 2005 to Brazilian club Corinthians.
Carlos’ scoring ratio with Boca was better than one in three games and he improved that to better than one in two at his second club.
Like Blues teammate Pablo Zabaleta, Tevez has an Olympic gold medal though from Athens in 2004 not last year in Beijing. He has clocked up 50 senior caps for his country.

Crossing the divide: Carlos Tevez is set to make the short hop to Manchester City after completing a medical on Monday
Carlos Tevez will fly back from holiday today to complete a £25million move to Manchester City and disappoint Chelsea.
The striker was being pursued by Chelsea owner Roman Abramovich's club but is heading for City after being persuaded to join the ambitious project manager Mark Hughes is masterminding.
Tevez will undergo a medical today and is hoping to join City's tour of South Africa, which departs on Wednesday, with a five-year contract worth £150,000 a week agreed.
Those wages and the fact that his family is settled in Cheshire worked against Chelsea, who were keen to lure him after he was released by Manchester United but are still adjusting to life as a club without the greatest spending power.
The changing of the guard in terms of finances in the Barclays Premier League has been underlined already this summer by City's signing of £12m midfielder Gareth Barry from Aston Villa and striker Roque Santa Cruz, who cost £18m from Blackburn.
But buying Tevez will also make its mark on neighbours United, who failed to convince the Argentina international they wanted him enough after his two-year loan expired at the end of last season.
His comments since, that he was not appreciated enough, have left a bitter taste among some staff at Old Trafford with coach Brian McClair accusing him of being disrespectful.
United's relationship with Tevez was complicated by the issue of third party ownership, with the interest of Kia Joorabchian and his investors key in any permanent deal, but the Premier League has made it clear City will have to own his registration outright.
Liverpool, Barcelona and Real Madrid showed interest, too, but could not compete with what was on offer at City - and the club's Abu Dhabi-based owners have not finished spending. They have given up on Barcelona striker Samuel Eto'o but Chelsea captain John Terry is still a target along with Everton's Joleon Lescott, Kolo Toure of Arsenal and Porto's Bruno Alves.
United have distanced themselves from reports in Spain that Eto'o has requested a free transfer so he can join them.