Mikel Arteta worked with Gabriel Jesus at Manchester City
The 25-year-old is manager Mikel Arteta's fourth signing of the summer, following the arrivals of midfielder Fabio Vieira, goalkeeper Matt Turner and Brazilian forward Marquinhos.
Arteta said he was "very excited" by Jesus' arrival.
"The club has done a tremendous job to recruit a player of this stature," he said.
Arteta, who worked with Jesus when an assistant coach at City, has been trying to boost Arsenal's attacking options following the departures of forwards Alexandre Lacazette and Pierre-Emerick Aubameyang on free transfers.
"I know Gabriel personally very well, and we all know him well from his time in the Premier League and being really successful here," the Gunners manager said.
"This is a position that's been on our radar for a long time now and we have managed to get a player that we all wanted, so I'm really happy."
Jesus, who will wear the number nine shirt for the Gunners, leaves City after five-and-a-half years.
He made 236 appearances and scored 95 goals for them, winning four Premier League titles, three League Cups and the FA Cup.
"It's been a pleasure to play for Manchester City," Jesus said.
"I feel like I am a better player now than when I arrived - and to win 11 trophies has been amazing. My four Premier League titles are particularly special for me.
"I want to thank everyone at City - the manager, my teammates and the fans - for all the support they have given me over the past five-and-a-half years."
The Premier League champions allowed Jesus to leave after signing Norway forward Erling Haaland from Borussia Dortmund for £51.2m in June, with young Argentine Julian Alvarez also expected to join the first-team squad.
Jesus assisted eight league goals for Manchester City in 2021-22, the joint-most of any player at the club along with Kevin de Bruyne.
Jesus joins a club looking to increase their goalscoring threat after finishing fifth in last season's Premier League and missing out on Champions League qualification.
He said he spoke to Arteta about "the club, the players, the project and the future" before the move.
"I believe 100% in Mikel," the striker said. "I had a very good time with him before, he's a very good guy and a very good coach as well. He helped me a lot. We would always stick together after the training sessions and do some finishing or something.
"He's a very intelligent guy and was an amazing player, so if he knows something, he can teach me or the young players."
Arteta relied on his younger players for goals last season, with 20-year-old Bukayo Saka their leading scorer with 12, and fellow England international Emile Smith Rowe, 21, adding 11.
-- Courtesy of BBC Sport