Iheanacho, 20, has signed a five-year deal at the King Power Stadium with the transfer fee officially undisclosed. However, the BBC reported the fee to be £25 million ($32.8 million).
“It’s a great signing for us. Kelechi is an enormously talented player that has shown a huge amount of promise at every level in which he’s played,” said Leicester manager Craig Shakespeare.
Iheanacho becomes the fourth new arrival at Leicester during the close season following the acquisitions of midfielder Vicente Iborra from Sevilla as well as goalkeeper Eldin Jakupovic and defender Harry Maguire from Hull City.
Iheanacho will wear the number eight shirt and joins fellow Nigeria internationals Wilfred Ndidi and Ahmed Musa at the 2016 Premier League champions.
“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. I was convinced and I’m happy to be here,” he said.
Iheanacho had signed a new contract with City until 2021 at the beginning of last season but saw his first-team opportunities at the Etihad Stadium curtailed by the arrival of Brazil forward Gabriel Jesus in January.
The academy product still made nine starts and 21 substitute appearances for Pep Guardiola’s team last term, scoring nine goals, but he has now decided on a fresh start.
In total he scored 21 goals in 64 games in all competitions since making his debut for City in 2015, while he has scored six goals in 10 appearances for Nigeria.
Leicester play away to Arsenal in the opening game of the new Premier League season next Friday, August 11.