The Blaugrana were in the market for a new goalkeeper due to the departure of Victor Valdes at the end of the 2013-14 campaign and they have now found their man in Ter Stegen.
The Germany international will sign a contract until the summer of 2019 with the Catalans.
Sporting director Andoni Zubizarreta has traveled to Germany a number of times in the past few months to see Ter Stegen live in action and the 21-year-old has done enough to convince the former shot stopper that he's the right man for Barca.
The reigning Spanish champion will announce the capture of Ter Stegen either once Valdes reveals his next destination or when La Liga is mathematically decided.
The young goalkeeper recently announced that he would not sign a contract extension to his current deal until 2015, prompting Monchengladbach to cash in on him this summer.
Ter Stegen is a product of the BMG youth academy and has made over 100 official appearances for the Bundesliga side since breaking into the first team in 2010-11.