The 34-year-old announced toward the tail end of the 2017-18 campaign that he intended to bring his two-decade spell at Camp Nou to an end this summer.
Vissel, who sit sixth in the Japanese top flight after 15 games, have now released a statement to confirm the transfer.
"By giving both fans and players the opportunity to see Iniesta's world-class play style and technique, we believe his decision to come to Japan will have a major impact on not just Vissel Kobe, but on football in Japan as well as the whole of Asia," owner Hiroshi Mikitani said in the press release.
"As the 'New Vissel Kobe,' we will work to achieve our goal of the becoming the No.1 club in Asia. His arrival in Japan will raise the profile of Japanese football globally, and we are already working on multiple activities to leverage his presence here and promote the J.League around the world."
Iniesta, a part of Spain's squad for next month's World Cup, had originally planned to join Chinese Super League side Chongqing Dangdai Lifan.