England international Farrell, who is currently taking a break from Test rugby for mental health reasons, had been in talks with the six-time French champions over a move to the Top 14 when his current contract with Saracens expires at the end of the 2023/24 Gallagher Premiership season.
In a statement posted on the club’s website on Monday evening, Racing confirmed Farrell will be joining them from July 1 on a two-year deal.
The 32-year-old has won 112 caps for England and served as captain during the 2018 summer Test series in South Africa before being officially appointed as Dylan Hartley’s successor for the following year’s Six Nations.
He opted to step away from the international game in the wake of England’s third-place finish at last year’s Rugby World Cup, and his decision to move to France means Farrell will be ineligible to play for the national team due to RFU regulations which
His Saracens club-mate Jamie George has been named as England captain for this year’s Six Nations.
Racing director of rugby and former England head coach Stuart Lancaster, who gave Farrell his international debut in 2012, had previously stated he would be delighted to have the fly-half join him in Paris.