The 20-year-old has penned a five-year contract at the King Power Stadium and has joined the club for an undisclosed fee reported to be in the region of approximately £25m.
A £50m buy-back clause has also reportedly been agreed with his former club.
Drawn out affair
The confirmed capture of Iheanacho brings an end to an extremely long and arduous saga. It was reported back at the start of July that the Foxes had agreed a deal for the striker with Pep Guardiola's Manchester City.
However, legal issues regarding the youngster's representatives were apparently preventing the deal from officially being announced. The Foxes though have managed to sign-off everything and have officially announced him as Leicester City player.
He will wear the No. 8 shirt at the King Power Stadium and could make his Foxes' debut on Friday evening as the team's preparations for the new season conclude with the home clash against German outfit Borussia Monchengladbach.
'It's the right move'
Talking to LCFCTV, Iheanacho described how delighted he was to finally be a Leicester City player. He said: "It feels good and I'm happy to be part of this team. I know the ambition of the team and speaking with the manager, he let me know what I need to do - to help the team achieve what they want."
The Nigerian also told of his ambitions for the future with his new club. He said that he wants to "achieve a lot" and "work really hard to achieve more in the future."
"It's a great decision for me to come here, not just to develop but to help the team achieve their goals and make the most of it. It's the right move to me," Iheanacho continued.
Eye for goal
Despite finding game-time at the Etihad Stadium hard to come by last season, he still arrives in the East-Midlands with considerable pedigree. An eye-catching breakthrough season in 2015/16 saw Iheanacho net 14 times in only 35 appearances.
Even more impressive though is that he still seems to find the back of the net even with limited opportunities and has notched 21 goals in as many starts with his former club in all competitions.
Foxes' fans will surely hope to see that sharp instinct as Leicester City travel to the Emirates Stadium next Friday for the Premier League's opener against Arsenal.