The 34-year-old also confirmed his retirement from playing after a five-year stint with the Gunners, during which time he won two FA Cups.
The former Everton and Rangers midfielder, who started his career at Barcelona, has been a rumoured target of Guardiola since the Spaniard’s appointment as City boss in February.
“Following recent media speculation surrounding my future I can confirm that I will be leaving Arsenal and retiring from playing to take up a coaching position at Manchester City,” Arteta wrote on Twitter.
“I’ve enjoyed an amazing five years at Arsenal and it’s been an honour and a privilege to captain such a great club.
“I am now looking forward to the challenge ahead at Manchester City. The opportunity to join Pep Guardiola and his team was an amazing opportunity for me and I am incredibly excited for the future.”