The 28-year-old has been on the brink of signing for the Top 14 side since early December, and now the French club have confirmed Flood will be in the team for the next campaign.
The England international has stated there are similarities between both his future club and Leicester Tigers, reasoning him to join the French club.
He said: "There is a history and core at this club which is respected around international rugby. It is a similar club to Leicester, and this is one of the main reasons I joined."
Flood has featured eight times for the Tigers this season in the Aviva Premiership, with two sub appearances scoring 77 points.
So far, the fly-half has made over 100 appearances for the Aviva Premiership champions and has scored over 1,290 points over a five year spell.
Flood stated: "Coming here will be like starting a new life, with new things to learn."
Toulouse have won 19 titles in their Top 14 history but currently sit fifth in the league, and last season lost in the semi-finals to runners-up Toulon.
But with his move to France, Flood made the hard decision of putting his England career on the line to join Stade Toulousain, considering England are hosting the Rugby World Cup in 2015.
Owen Farrell is England's current fly-half and has been impressive in the recent Six Nations tournament, kicking a 100% game in the win against close rivals Wales.
But Flood believes that joining Toulouse will be a new beginning for the star who has had an illustrious career.
"It's like becoming a child again, having to learn a new way of life and a new style of play with Toulouse," he concluded.
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