The 25-year-old has been pushing for a move away from Stamford Bridge since the start of 2026.
Fernandez was initially flirting with a move to Real Madrid, which resulted in a two-game suspension, handed to him by former Chelsea boss Liam Rosenior.
The Spanish weren’t interested, however, going as far as releasing a statement to confirm they had no intention on making a move for the midfielder.
Man City became the only viable option for Fernandez, with former manager Enzo Maresca keen on a reunion.
The two clubs finally reached an agreement on transfer deadline day, reportedly worth a joint British record £125 million.
Fernandez signs a five-year deal with the club, keeping him at the Etihad until the summer of 2031.
On joining Manchester City, Fernandez said: "Manchester City are the most successful club in England in recent times.
"Every player wants to be part of a club like this because everyone knows how well-run City are.
"I could not be happier to be here, and I am ready for the challenge of helping City continue winning trophies. This is a club built for success.
"If you look across the squad, City have quality in every area. I want to learn from my new teammates and become a better player.
"I give absolutely everything, and I can promise Manchester City that I will continue now that I'm here."