Talks between the Reds and their Italian counterparts accelerated this week as Balotelli's agent, Mino Raiola, flew to England on Wednesday.
After a permanent deal was agreed between the two clubs, the Italy striker himself flew in to complete a medical and put pen to paper on a long-term deal at Anfield.
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The 24-year-old clashed with former City boss Roberto Mancini in training during his time in Manchester and was never far from the headlines after setting off fireworks in his apartment.
In the wake of that incident, Balotelli lifted his jersey to reveal the now-famous "Why Always Me?" message after scoring against in the landmark 6-1 victory against Manchester United in 2011.
Liverpool boss Brendan Rodgers had been scouring Europe for a replacement for Luis Suarez all summer and was continually linked with a move for Monaco striker Radamel Falcao.
The Northern Irishman had in fact completely ruled out Balotelli's arrival earlier this summer, declaring: "I can categorically tell you that he will not be coming to Liverpool. He is a wonderful player but he is an AC Milan player."
Balotelli scored 20 Premier League goals in his 54 appearances in England, and 26 in 43 Serie A matches since moving back to Italy with the Rossoneri.