The fee was not disclosed but British media reported it to be in the region of 50 million pounds ($76.
92 million), a record for the club whose previous biggest signing was Raheem Sterling from Liverpool in July for an estimated 49 million.
Only Angel di Maria has cost more in British football, when Manchester United bought the Argentine from Real Madrid last year for almost 60 million.
“I want to reach the highest level possible as a player and I think the most important thing is that at the end of the season we can be happy and maybe have some titles,” playmaker De Bruyne told the City website (杭州桑拿,mcfc.co.uk).
“I think this is the most important for the club, the players and for the fans of course.”
The 24-year-old has forged a reputation as one of Europe’s most creative midfielders with 33 assists in 72 appearances in all competitions for the German side.
He started his career at Belgian side Genk and was an integral member of their title-winning side in 2011, scoring six goals and registering 17 assists in all competitions.
In 2012 he joined Chelsea but was immediately loaned out to Bundesliga side Werder Bremen, registering 10 goals and 10 assists in 34 appearances.
The 33-cap Belgium international struggled to secure regular football at Stamford Bridge, however, and moved to Wolfsburg with Chelsea’s manager Jose Mourinho saying he had been “an upset kid, training very bad and not ready to compete”.
At Wolfsburg, however, he thrived and became one of Europe’s most revered creative midfielders.
“We are very happy to have added Kevin to our team and I have no doubt that he will be a big success on his return to the Premier League,” City manager Manuel Pellegrini added.
“It takes a special footballer to improve our squad and I have no doubt that Kevin is certainly one of those – he has all of the mental, physical, tactical and technical attributes required to fit straight in.
“We like to play attractive, attacking football and bringing in a player like De Bruyne will only aid us as we fight on four fronts.”
Following the announcement Wolfsburg tweeted: “thank you for everything and we wish you lots of success.”
De Bruyne became City’s fourth signing of the close-season following the acquisitions of England internationals Sterling and Fabian Delph and Argentina defender Nicolas Otamendi. ($1 = 0.6500 pounds)
(Reporting by Tom Hayward and Steve Tongue, editing by Ed Osmond/Alan Baldwin)