The Premier League rivals said their first teams would play a one-off match for the inaugural 'China Cup' on July 27 with a local kick-off time of 20:00 (12:00 GMT), six-and-a-half hours before the London opening ceremony begins.
"It is... fitting that two English clubs are playing each other on the opening day of the London 2012 Olympics, in the stadium which hosted the Beijing 2008 Olympic Games," Arsenal's chief executive Ivan Gazidis said in a statement.
It will be the second year in a row that the Gunners have travelled to China in the off-season, with Arsenal playing matches in Malaysia and China last year.
League leaders City played in China in 2006, when they visited Shanghai under former boss Stuart Pearce with a team that included Chinese international defender Sun Jihai, but this will be the Abu Dhabi-owned club's first appearance in Beijing.
The stadium, built for the 2008 Olympics, hosted the Italian Super Cup between AC Milan and city rivals Inter in front of more than 70,000 local fans last August.
"We enjoy huge support in Asia and by playing a match in Beijing we will once again be bringing the club close to our loyal fans in China," Gazidis said.
Wang Shuyan, president of promoters Beijing Winoly International Sports Culture Co, said the match was part of the company's strategic growth plan to bring top clubs and leagues to China.
"Our focus is on elite, authentic football. Arsenal v Manchester City will undoubtedly be the highest quality EPL match ever in China," he said.
