The 22-year old former Argentina U20 international arrives in Texas after 53 league appearances for River for whom he debuted as 1 7-year old back in 2008.
Dallas technical director Fernando Clavijo was looking forward to Diaz, who has spent time on loan with Union Espanola, bringing his creativity to Frisco.
"Mauro Diaz is a young prospect who fits the profile FC Dallas was looking to add," said Clavijo.
"We're excited to see how he will complement an already very talented offensive line-up as we head into the second half of the season with the goal of winning the MLS Cup."
Dan Hunt, Vice President of Hunt Sports Group who owns FC Dallas, added: "I am very excited to be able to welcome Mauro Diaz to FC Dallas. I was first impressed with his playmaking abilities as an 18-year-old playing with River Plate in 2009. I am pleased he'll now be a part of FC Dallas' strike force."