The 25-year-old has agreed a three-year contract at St. Andrew’s and will wear the number 32 shirt.
Vazquez becomes Birmingham’s fourth summer signing, adding physicality, mobility and technical quality to Chris Davies’ attacking options ahead of the 2026/27 campaign.
He began his career at Boca Juniors, making nearly 100 appearances and contributing 23 goals and assists before helping the club win the Primera División in 2022.
After joining Anderlecht in 2023, Vazquez made 118 appearances, scoring four goals in 10 Europa League matches.
“We’re really pleased to have brought Luis to the Club,” said Chris Davies.
“He gives us a different profile in our attacking options and brings qualities that will add another dimension to the squad.
“He has the physicality to compete in the Championship but also possesses excellent technical ability and mobility. He can score different types of goals and gives us another option in the way we can attack teams.
“Luis has already played a lot of senior football for someone who is still only 25, including at Boca Juniors and Anderlecht, and he has experience of playing in European competition and big games.
“We believe his qualities are a good fit for the Championship and for the way we want to play, and we’re looking forward to working with him.”