Commenting on Nacewa's arrival, Leinster coach Michael Cheika said: "We are delighted that Isa has agreed to commit his future to Leinster. Isa has a wealth of experience at Super 14 level and he is an exciting player with a strong work ethic and I am confident that he will fit into the culture of the province.
"Isa is a top class attacking player whose versatility as either a midfield or back three player makes him a threat as an out and out try scorer, as well as a playmaker in his own right.
"He will add great depth to our back-line for next year and he will also increase our kicking options. He will be a great addition to our squad and we look forward to his arrival in the summer.
"We are continuing to work hard behind the scenes to complete our playing roster for next season and I am sure that the players and backroom team that we assemble will help bring Leinster to another level in both the Magners League and the Heineken Cup competitions," he added.
For Isa Nacewa, making the decision was difficult but he is looking forward to the move
"I really enjoy playing for the Blues and Auckland but am very aware I have to make the most of my playing career while I can. All of us in this game know it is for a finite time-period so it really comes down to making smart decisions short and long term," he said.
"Having a shot at the All Blacks was and will continue to be my long term goal. But the reality is that's not an option for me right now, so I have to get on with my career."
At the 2003 World Cup, a 21-year-old Nacewa was called into the Fiji squad and spent two minutes on the field. At the time he had no idea this would render him ineligible to ever play for New Zealand.
News of Nacewa's departure has been a tough blow for both the Blues and Auckland Rugby but it comes as no surprise.
"Isa has been in demand for quite some time. He is such an outstanding player to have in your line-up and has the ability to cover nearly every backline position," said Blues coach David Nucifora.
"His authority and leadership within this squad is exemplary and Leinster are very fortunate to have him."
Blues and Auckland CEO Andy Dalton commended Nacewa for his loyalty, saying: "We have been aware of Isa's popularity overseas and duly impressed at his ability to resist tempting offers in order to continue playing for us and pursue the right to wear a black jersey.
"It is a shame Isa is even in this predicament and I hope long term there will be a way he can play for the country he was born and raised in. Either way, our doors will always be open to him."
Born in New Zealand, Nacewa began playing rugby at the age of five and first gained provincial selection as a 20-year-old. He made his Blues debut in 2005 against the Highlanders (he has 54 caps for Auckland, 40 caps for the Blues).
Isa Nacewa Profile:
Position: Outside back
Date & Place of Birth: 22/07/1982, Auckland
Provincial Caps: 54
Provincial Points: 212 (21t, 34c, 19p)
Provincial Debut: 2003 v Samoa
Super 14 Caps: 40
Super 14 Points: 203 (12t, 25c, 31p)
Super 14 Debut: 2005 v Highlanders
Test Cap: 1
Test Debut: 2003 v Scotland (Fiji)