The Greek international arrives from Club Brugge in a deal worth £33.8million, agreed last week, and will act as a direct replacement for Leandro Trossard, who completed a £15.3million move to Turkish club Besiktas.
Tzolis enjoyed a stellar campaign at Brugge last season, scoring 22 goals and providing 29 assists in 52 appearances across all competitions as the Belgian side won their 20th league title.
In total, he has contributed 43 goals and 45 assists in 108 outings since joining from Fortuna Dusseldorf in 2024, having previously spent time on loan at the German club during a season away from Norwich, where he spent three years after starting his career at PAOK in Greece.
The 24-year-old has nine goals in 34 caps for Greece and has faced Arsenal before, playing the full 90 minutes as Brugge lost 3-0 at the Emirates in last season's Champions League.
He becomes Arsenal's third arrival of the window, following the free transfer signing of goalkeeper Illan Meslier from Leeds and the £34.5million permanent deal for defender Piero Hincapie, whose loan from Bayer Leverkusen was made permanent after a successful season on loan.
While Arsenal strengthen their squad from outside the club, one of their academy products is weighing up his own next step. Charles Sagoe Jr, on loan at Kalmar FF in Sweden, has scored one goal and provided eight assists in 13 Allsvenskan appearances this season, form that has alerted fellow Swedish side AIK.
Responding to that interest, Sagoe Jr said: "It is always flattering that AIK, a big club in Sweden, is interested in me. Then it seems like I'm doing something right. Right now, I'm enjoying playing in Kalmar where I have a loan until the end of the season.
"Obviously, I'm talking to my representatives, Arsenal and my family too. I don't have much more to say," the 21-year-old continued to Fotbolskanalen.
Sagoe Jr is uncertain whether he will remain in the Allsvenskan on a permanent basis.
"I'll have to talk to Arsenal about it, because they gave me the opportunity to come here on loan. I really wanted to go abroad, and I definitely felt that Sweden could feel like home. You never know what will happen so we'll see at the end of the season," he said.
Team-mate Charlie Rosenqvist has been full of praise for Sagoe Jr's impact at Kalmar.
"An incredible player. His one-on-one ability is top class. We're getting to know each other better match by match," Rosenqvist said.
Asked what Kalmar would have done without the winger, Rosenqvist added: "Hard to say. It probably wouldn't have gone well."