The 26-year-old England international has put pen to paper on a six-year contract at the Etihad Stadium and has become City's third signing of the summer window after striker Erling Braut Haaland and goalkeeper Stefan Ortega.
Another new addition to Pep Guardiola's squad will be Argentine forward Julian Alvarez, who joined the club from River Plate in January before returning to his homeland on loan. The 22-year-old is set to join up with his new teammates before pre-season begins later this month.
Ahead of the 2022-23 campaign, Sports Mole takes a look at how the Premier League champions could line up with their new recruits in Guardiola's starting lineup.
The arrival of Ortega will see the German goalkeeper become City's new number two behind first-choice stopper Ederson, with Zack Steffen allegedly set to join Middlesbrough on a season-long loan deal. Ortega may be given opportunities in the domestic cups but is only set to play in the Premier League or Champions League if Ederson if unavailable due to injury or suspension.
In defence, Ruben Dias, Aymeric Laporte, John Stones and Nathan Ake will all compete to start at centre-back, while Kyle Walker and Joao Cancelo are currently the first-choice options to start as full-backs, with Oleksandr Zinchenko's future at the club uncertain. The potential arrival of left-back Marc Cucurella, however, could see both Walker and Cancelo rotated by Guardiola, with the latter able to operate on both sides of the back four.
Following the departure of Fernandinho, the arrival of Phillips will likely see him compete with Rodri for the deep-lying midfield role in front of the back four, although he could also play slightly further forward. Twenty of the Yorkshireman's 23 appearances for Leeds last season were as a defensive midfielder, while the other three were at centre-back.
Star playmaker Kevin De Bruyne is one of the first names on the teamsheet when fit, and he will continue to dictate play from the right side of a midfield three, while the likes of Bernardo Silva and Ilkay Gundogan will battle to start alongside him.
Phil Foden could also be handed starts as a centre-midfielder if he is not operating on the flanks or down the middle. The 22-year-old predominantly played in the latter position last season, but the additions of Haaland and Alvarez will likely see him feature more frequently as a winger or midfielder next term.
Scoring goals is not something City lacked last season as they notched up an impressive total of 150 in all competitions without a recognised striker, more than any team across Europe. Guardiola's attack, however, will now become even more menacing for their opponents in 2022-23 and beyond following the arrivals of Haaland and Alvarez, two goal machines for Borussia Dortmund and River Plate respectively.
Haaland – who scored 83 times in 87 games for Dortmund – will play down the middle as the central striker, and while Alvarez – who has netted 41 goals in 69 appearances for River Plate since the start of 2021 – can also play as a centre-forward or a false nine, he may be handed more regular appearances on the flanks when Haaland is on the pitch.
Despite the departure of Gabriel Jesus to Arsenal and the potential sale of Chelsea-linked Raheem Sterling, City still have a number of options in wide areas, with Alvarez, Foden, Riyad Mahrez, Jack Grealish and Cole Palmer all set to vie for a place in Guardiola's first XI, while Bernardo Silva could also work his magic on the flanks if required.