The 29-year-old arrives from Benfica, where she was named the Portuguese top-flight’s player of the year this season.
Lacasse will bolster Arsenal’s forward line having scored 102 goals in 131 games during her four years at Benfica.
The Gunners have made strengthening their attack a priority this summer and are also set to sign England striker Alessia Russo when her contract at Manchester United expires on Saturday.
“I’m really pleased that we have signed Cloe to strengthen our forward line here at Arsenal,” said Arsenal head coach Jonas Eidevall.
“Cloe is a proven goalscorer and has shown her quality over a number of seasons in two European leagues as well as the Champions League.
“She will add a different dimension to our attacking game and I’m looking forward to working with her.”
Lacasse has won 19 caps for Canada and will be part of their squad at next month’s Women’s World Cup.
“I want to go to the next level and score goals here for Arsenal,” she said.
“I feel ready mentally and physically to be able to contribute here and win titles and I feel that this club has everything it takes to compete for the highest honors.”