City have retained their interest in Mahrez ever since and finally agreed a deal to take him from Leicester early this week.
The Algerian winger is understood to have signed a £200,000-a-week, five-year deal at the Etihad with an option to extend.
He then came on as a substitute the next day, having missed the previous two games, as Leicester were beaten 5-1 away by Pep Guardiola's City, and featured in every match for the Foxes for the rest of the season.
City were thought to have offered £50m at the time, but the final fee exceeds the £57m they paid Atletico Madrid for defender Aymeric Laporte in January.
"Watching them from afar has been a pleasure. They're redefining the English game and I wanted to be a part of it", Mahrez said on City's website.
"I am so pleased to have joined City, a side playing great football under Pep Guardiola", the Algeria global told the official club website. "We're sure he will bring additional attacking quality to our squad".
However, with the current transfer window still open for another four weeks, Claude Puel has now sanctioned the sale.
The Premier League champions were on the verge of sealing Mahrez's deal in the winter, but the Foxes insisted on recouping about £100m for their prized asset.
City director of football Txiki Begiristain is confident Mahrez will prove a valuable addition as the champions look to mount a successful defence of their Premier League title and succeed in Europe.
Two years later, he was named PFA Player of the Year after scoring 17 goals and setting up a further 10 as they won the Premier League title.