Toronto said the 31-year-old Tottenham star will be introduced on Monday, when U.S. international midfielder Michael Bradley is also expected to be unveiled.
"We are thrilled, for our club and for our fans, with the opportunity to bring a global football superstar like Jermain Defoe to Toronto FC," Tim Leiweke, president and CEO of Maple Leaf Sports & Entertainment, said in a statement Friday.
"We promised our fans in October that building a winning club was our top priority and we scoured the globe to find the right players to fulfil that promise. Right from the beginning of this process, Jermain Defoe was the top player on our list and we got our man.
"We would like to thank Tottenham as well as MLSE ownership for this very clear demonstration of our commitment to winning. Most importantly, we want to thank Toronto FC fans for their patience and support getting to this day."
Defoe has scored 142 goals during two spells at Tottenham and is the club's top scorer in European competitions.
Bradley will be the next piece of the puzzle to officially fall.
AS Roma announced Thursday that it had sold the 26-year-old American to MLS for US$10 million. A source with knowledge of the league said Toronto was the lone MLS suitor.
Tottenham has at least nine matches to play before Defoe leaves for MLS. Toronto opens its 2014 season March 15 in Seattle.
The late February departure seems to be a compromise. Defoe will miss almost all of Toronto's pre-season but should arrive game-ready.
Spurs' strike force avoids being depleted.
"Everybody knows how much this club means to me and I will play my heart out for the team and the fans until my last kick for the club," Defoe said in a statement on Spurs' website. "I have had a fantastic time here and the fans have always been amazing to me.
"I am grateful for the opportunity for myself and my family to experience living overseas and for me to play in the MLS with a contract that will take me to the age of 35. I have no doubt I shall be coming back as a fan supporting the team in the years to come too."
Tottenham also announced an advertising and marketing deal with Maple Leaf Sports and Entertainment, and a July 23 friendly in Toronto as part of the transfer.
"This is a great opportunity for Jermain and he feels it is one that he wishes to pursue," said Spurs head coach Tim Sherwood. "He has played a big part in the club for many years and we all know he will give his best until his last minute in a Spurs shirt.
"We have several attacking options within our squad for the remaining dozen or so games of the season after Jermain departs and we shall keep our options under review. We also have a goal threat from players in other areas of the pitch including having wide players and attacking midfielders who will enable us to vary our shape when required."
"Everybody at the club wishes Jermain every success for the future and he will always be welcome at (White Hart) Lane."
Defoe first joined the London club in February 2004 from West Ham, making 177 appearances and scoring 64 goals before leaving to join Portsmouth in January 2008. The England international was re-signed a year later and has since made 185 appearances, scoring 78 goals.
"Jermain brings the complete package to Toronto FC," said Toronto FC general manager Tim Bezbatchenko. "He is an accomplished scorer and I know that his skill and infectious personality will make him a popular star both in Toronto and around the League."
The advertising deal between the two clubs includes promotional, branding, experiential activities, advertising, broadcasting, social media and digital rights across the four-year agreement and at all MLSE properties and media sites. Tottenham and Toronto FC said MLSE will stock, promote and sell official Spurs merchandise at all its retail outlets and support the THFC Official Canadian Supporter's Club.
The Spurs exhibition game against Toronto will come between matches against the Seattle Sounders on July 19 and Chicago Fire on July 26.