Mills made 75 appearances in a two-year spell with Reading
Leicester have signed defender Matt Mills from Championship rivals Reading for a fee believed to be more than £5m.
The 24-year-old agreed personal terms on a four-year deal and passed a medical on Thursday evening.
The defender began his career at Southampton and had loan spells with Coventry and Bournemouth, before moving to Manchester City in January 2006.
BBC Radio Leicester
understands the fee is £4.5m initially with add-ons taking the final amount to over £5m.
That would beat Leicester's existing transfer record of £5m for striker Ade Akinbiyi from Wolves in 2000.
Mills made only two appearances for Man City and joined Doncaster for £300,000 two-and-a-half years later after a couple of loan spells.
After a season with Doncaster, he
joined Reading for £2m in August 2009
and last season led them to the Championship play-off final as captain.
At Leicester, he will team up again with manager Sven-Goran Eriksson, his boss at Manchester City.
told the Foxes' website
: "Matthew has developed into one of the best defenders outside the Premier League.
"He is strong, composed and a natural leader. He's a good talker and a real team player."