The 23-year-old departs the Foxes after an injury-disrupted campaign at the King Power Stadium, where a knee problem restricted him to just six appearances as Leicester suffered relegation from the Championship.
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Kristiansen arrived at Leicester in January 2023 from Copenhagen in a £17 million deal while the club were still in the Premier League.
Following Leicester’s drop to the Championship in 2023/24, he spent the season on loan at Italian side Bologna before returning to England.
The Denmark international has made 51 appearances for Leicester across all competitions and will now look to revive his form in Greece with Panathinaikos.