The move from their current sponsors, Umbro, will take place at the start in two years and Blues chief James MacBeath hailed the deal as "a very important step forward"
Manchester City have announced plans of a five-year partnership with Nike starting in the 2013-14 season.
The Blues will remain sponsored by Umbro next season before all kit, training wear and related products will start to be designed and manufactured by the American sports brand.
The deal means that City will share shirt sponsors with local rivals Manchester United, who have been sponsored by Nike since 2002.
Nike brand president Charlie Denson told the club’s official website: “We’re excited by the opportunity to further develop the relationship between City and Nike Inc, which builds on the successful partnership the club has already enjoyed with Umbro, and reflects both the ambitions of the club and the Nike brand’s position within the world of football.”
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The new sponsorship deal could lead to more funds being available on bringing new signings to an already illustrious squad of players at the Etihad Stadium with the financial fair play rules at the back of the City hierarchy’s minds.
John MacBeath, City’s interim chief executive officer, added: “We are delighted to have further strengthened our relationship with the Nike family.
“Nike's deserved reputation as the leading global sports brand, its unparalleled R&D capacity, leading global retail distribution networks and award winning marketing capabilities mean that this is a very important step forward in the evolution of Manchester City.”