The quick and skilful 20-year-old had been targetted by Pep Guardiola and his recruitment team as a replacement for Leroy Sane, who departed for Bayern Munich last week in a £41m transfer.
Torres had only one year left on his Valencia dea and has now signed a five-year contract at the Etihad.
“I am so happy to be joining City,” Torres said. “Every player wants to be involved in attacking teams and Manchester City are one of the most attacking in world football.
“Pep encourages a really open, aggressive style, which I love, and he is a manager with a proven track record of improving players. To have him overseeing my development is a dream.
“City have won plenty of trophies in the last 10 years and I hope I can play a role in continuing that success.”
Torres, 20, met with City’s sporting director Txiki Begiristain in Barcelona on Tuesday to complete the transfer.
“We have followed Ferran’s progress closely and have been very impressed,” said Begiristain. “He is young and still developing, but his technical qualities are exactly what we are looking for in a winger. He is quick, direct, can create space with one movement and is capable of producing match-winning moments.
“I feel this is the perfect place for him to develop and with Pep in charge he can take his game to the next level.”
City have made clear they want to move quickly in the transfer market this summer, ahead of what is a shortened preseason before the new campaign which begins on 12 September.
Nathan Ake is expecting to complete a transfer from Bournemouth in the coming days, with the 25-year-old defender set to be back-up for first-choice centre-back Aymeric Laporte and offer another option at left-back.