After New York City confirmed Villa, 36, would leave the club upon the expiration of his contract, the 2010 World Cup winner made the announcement via social media that he will be moving to the J1 League.
Iniesta left Barca for Vissel Kobe in May, and the pair are poised to join forces again after starring together at Camp Nou from 2010 to 2013, as well as for Spain's national team.
"In my years as a professional footballer, I have had to make many important decisions. For an athlete, the ones made off the field are the hardest, and I find myself in another one of those moments now," Villa said.
"Throughout my career, I have always listened to my body, people around me, and my instinct most of all.
"In those moments of doubt, I hope that a sign, a detail or something gives me clarity. A new challenge awaits, Asia."
My new club. https://t.co/jC8UcI6ZjI— David Villa (@Guaje7Villa) December 1, 2018
Following the release of his signing video, Villa attended a press conference in Japan on Saturday.
“I take care when making such big career decisions, I need to know a club really wants me," the frontman said when asked about his choice to move to the J1 League.
“I love to feel welcome and I felt that from Vissel Kobe. That's a big reason.
“When I got the offer from Vissel I called Iniesta and my wife called Andres' wife.
“The city of Kobe, the wonderful times with family, hearing about the club's togetherness and their project – I got a good impression of the club from Andres.
“He was my team-mate as well as my friend for many years. It's great that I can challenge myself in a new project with him.”
During his time in the MLS, Villa scored 80 goals in 126 appearances and earned a recall to the Spanish national team in 2017 – three years after his previous appearance for La Roja.
The two also played for arguably the greatest national team in history, as they won the European Championship - Villa once, Iniesta twice - and the World Cup together with Spain.
Villa was particularly key to the former success, as he won the Golden Boot at the tournament, while he is also Spain's all-time top scorer with 59 goals.