The move comes together as a direct consequence of a separate deal: Everton's need for attacking reinforcement grew urgent once winger Iliman Ndiaye's £65m switch to Manchester City looked set to go through, with Everton turning immediately back to the club taking him for a replacement.
No loan fee is attached to Grealish's return, and Everton will cover the substantial majority of his wages, reported to be around 90%, with the arrangement also including an option for Everton to sign him permanently for £50m next summer, when his City contract expires.
Grealish spent much of last season at Everton under an identical arrangement, scoring twice and providing six assists in 20 appearances before a foot injury curtailed his campaign in January. Everton held an option to make that move permanent for £50m at the time but chose not to trigger it, with the injury and the size of the fee both weighing on the decision.
Since returning to Manchester City this season, Grealish has made only two substitute appearances under new manager Enzo Maresca, coming off the bench in the Community Shield defeat by Arsenal and in a Premier League win over Bournemouth.
Grealish had attracted interest from elsewhere during the window, including from boyhood club Aston Villa, but his stated preference throughout was a return to Merseyside.
Everton have also agreed a separate £3m deal to sign Ainsley Maitland-Niles from French side Lyon, where the versatile 29-year-old had been a regular starter, making 42 appearances last season and starting in the Champions League against Fenerbahçe as recently as 26 August, providing an assist in that game.
The former Arsenal player, who has won five caps for England, can operate at full-back or in midfield and was in the final year of his contract at Lyon, giving the Ligue 1 club reason to cash in before the window closed.
Both moves form part of a busy deadline day at Goodison Park, with David Moyes also continuing to push for a separate deal to sign Monaco striker Folarin Balogun before Tuesday's cut-off.