The Brazil international makes the move in a reported £45 million ($54 million) deal. He scored 95 goals in 236 games over nearly six seasons at City and won the Premier League four times, League Cup three times and the FA Cup.
Jesus, 25, reunites with Arsenal manager Mikel Arteta, who was Pep Guardiola's assistant at City before taking over the Gunners.
“We spoke a couple of times about the club, the players, the project and the future,” he told arsenal.com.
“I believe 100 percent in Mikel. 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 player.
Arsenal needed reinforcement up front after the departure of Alexandre Lacazette, whose contract expired, and Arteta knew the man he wanted to come in.
“I'm very excited. The club has done a tremendous job to recruit a player of this stature,” he said.
“I know Gabriel personally very well, and we all know him well from his time in the Premier League and being really successful here.
“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.”