Guardiola announced on Friday that he will be leaving City after a trophy-laden decade in Manchester, which yielded 20 honours, including six Premier Leagues and the Champions League.
City's North Stand, which has been redeveloped and expanded, will be renamed 'The Pep Guardiola Stand' in honour of the 55-year-old as a parting tribute when he bids goodbye at home to Aston Villa on Sunday.
City owner Sheikh Mansour said: "I said a long time ago that Manchester City should have the very best people at its disposal, both on and off the field. For 10 years, Pep has been the personification of that ambition.
"He has made an indelible imprint on the DNA of the Club. One that is borne more from how he won than from the many trophies he lifted.
"He has the unending gratitude of myself and the entire City family, a family of which he will always be part."
The North Stand has been under development since 2023 and it will reopen against Villa with an additional 7,000 seats, which expands the Etihad's capacity to more than 61,000.
City have also commissioned a statue of Guardiola, which will sit outside on the approach to the stand.
Chairman Khaldoon Al Mubarak added: "The Pep Guardiola Stand, and the statue that will sit outside it, rightly ensure that Pep's legacy will remain forever woven into the fabric of this football club, the city of Manchester and English football.
"The unique relationship that he has with our fans has been earned through the honesty and passion of his 10 seasons fighting to bring them success.
"The Pep Guardiola Stand is a fitting and permanent reminder of that relationship, the most successful period in our Club’s history, and the unique football genius at its heart."