The deal sees the 21-year-old defender move to the Eredivisie on a five-year deal, subject to a medical exam.
Alvarez had been regularly linked with Ajax all summer and Dutch newspaper De Telegraaf confirmed personal terms had been agreed to earlier this week, with the outlet reporting that the offer from Ajax at almost $17 million.
"Edson Alvarez is a player we like," Ajax sporting director Marc Overmars said earlier this week to Dutch outlet Eindhovens Dagblad. "I think he's at a good age, 21, is a regular international for Mexico and we've known about him for a while because we've been following him."
Ajax have seen two of their star players leave this summer, with Frenkie De Jong joining Barcelona and former captain Matthijs De Ligt bolting for Juventus. The club won the domestic double and reached the Champions League semifinals last season where they fell to eventual runners-up Tottenham Hotspur.
Alvarez rose up through the Club America youth academy, scoring twice in the 2018 Apertura final against Cruz Azul to help win the title for Las Aguilas. The Estado de Mexico native made his Mexico debut in 2017. He then featured for El Tri at Russia 2018 and was a regular in the team that won the Gold Cup this summer.
He becomes the latest high-profile Mexican to move to the Netherlands, with Hirving Lozano and Erick Gutierrez at rival club PSV Eindhoven.