The move ends an unsuccessful run for the Spain international with the Premier League club, with the striker having never found his place in the side.
Nolito moved to the Etihad Stadium in 2016 shortly after Pep Guardiola took charge, having excelled at Celta.
But despite playing a total of 30 games in his debut season in England he remained a bit-part performer, making the majority of his appearances off the bench and netting on just six occasions.
And after being declared surplus to requirements by Pep, Sevilla have announced that he is travelling to Andalucia to put pen to paper on a three-year deal.
"Sevilla and Manchester City have reached an agreement in principle, pending a medical and the signing of the contract, for the transfer of Nolito to the Seville side for the next three seasons," a statement on the club's official website confirmed.
"Nolito is an attacker that moves mostly down the left wing and will turn 31 in October.
"The player will arrive in Seville this Sunday to undergo his medical tests."
The move would see Nolito team up with his old mentor at Celta, Eduardo Berizzo, who stepped into the fold in June when Jorge Sampaoli left to take the Argentina job.
Berizzo has been busy in the transfer market since taking over, having already confirmed the signings of Guido Pizarro, Ever Banega, Sebastien Corchia and Luis Muriel in little over a month.