Mangala had long been linked with a transfer to the Premier League, with City, Chelsea and Manchester United all rumoured to be potential destinations.
However, speculation over the France international's future has now come to an end, after City announced his arrival on Monday.
A statement released on the Premier League champions' official website read: "Manchester City are delighted to announce the signing of Eliaquim Mangala from FC Porto.
"The 23-year old central defender becomes the sixth signing of the summer, and will quickly re-join his old Porto team-mate Fernando at the Etihad Stadium."
Mangala joined Porto from Standard Liege in August 2011 and helped the club to successive Primeira Liga titles in his first two seasons at Estadio do Dragao.
Porto endured a disappointing campaign last term, finishing third behind Benfica and Sporting, but Mangala was still named in France's squad for the FIFA World Cup.
Mangala said: "City is a top club in Europe. For me, it was an important step to leave Porto and join Manchester City in order to continue my progress.
"I want to win titles and I believe I can do this. I am ambitious and this is why I am here.
"I'm very happy to come to England because for me, the Premier League is the best league in the world. It is a very intense and very aggressive competition.
"The fact that Fernando is here is better because I played with him at Porto but there is also other players that I know like [Bacary] Sagna, [Gael] Clichy and [Samir] Nasri."
City boss Manuel Pellegrini added: "I'm delighted to have added a player of Eliaquim's quality in the squad ahead of the new season.
"He is already a fine player but in my opinion, he has all of the mental, physical, technical and tactical attributes to become one of Europe's very best defenders.
"Eliaquim is a player I believe will make an immediate impact in the Premier League, thanks to his physicality, his reading of the game and quality on the ball.
"I think he will prove to be a great signing for us."
Mangala follows Willy Caballero, Fernando, Frank Lampard, Bacary Sagna and Bruno Zuculini in joining City during the current transfer window.
