The Italy international striker and team-mate Nigel de Jong will face their former employees in a pre-season tournament that also features Bayern Munich and Sao Paulo
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City will face AC Milan in the first semi-final of the tournament, giving Balotelli and team-mate Nigel de Jong the chance to face their former team.
The winner of that match will then face either European champions Bayern or Sao Paulo who face off in the other semi-final.
Balotelli joined City in 2010 from Inter and went on to win the Premier League and FA Cup before moving to Milan in January.
The last Audi Cup took place in 2011, with Barcelona beating Bayern courtesy of two goals from Thiago Alcantara.