City have now broken the club's transfer record for the second time in 2018, the champions reported to have paid £60 million ($107m) for Mahrez, more than their previous landmark fee for Aymeric Laporte.
Leicester - who have seen other key members of that title-winning side depart since such as N'Golo Kante to Chelsea - can afford to be generous in their words as they have turned a massive profit on Mahrez, who signed from French side Le Havre for just £450,000 in 2014.
The Algeria worldwide, one of Leicester's title-winning heroes from the 2015-16 season, handed in a transfer request in January and had a 10-day absence from the club before returning to training with them on February 9.
"Riyad leaves with the best wishes of everybody who has worked with him at Leicester City Football Club".
With Mahrez looking likely to leave the King Power Stadium this summer, Leicester are looking to bring in reinforcements as City winger Patrick Roberts could be heading the other way in a deal which is said to be worth £10m.
"Riyad is a hugely talented player".
After helping them win promotion to the Premier League, he then helped them win the English top flight, scoring 17 goals in 37 games as the won the title in 2015-16.
"I am so pleased to have joined City, a side playing great football under Pep Guardiola", Mahrez told the club's website.
'Watching them from afar has been a pleasure.
'I think we can be successful over the coming years and I believe my own game can develop under Pep's management'. "He beats defenders and creates space", he said.
The Algerian scored four goals in 30 appearances in Leicester's first season back in the Premier League as the Foxes mounted a late surge to stay clear of relegation.
- Manchester City sign Riyad Mahrez from Leicester City in club-record deal
- Four more boys safely out as day two mission ends
- Brexit, stage right: how Theresa May faced down United Kingdom government rebels
- Sterling at heart of England World Cup bid despite goal drought
- Fearless France ready to show Belgium's Henry he picked wrong side
- YouTube to invest $25 million to boost 'trusted' news sources
- Buffon makes a prediction on Neymar after World Cup flaws
- Rodolfo Rodriguez: Full Story of 92-Year-Old Assaulted In Texas
- Guest list, godparents announced for Prince Louis' christening
- France vs Belgium: A 'Final Quality' Match