Leeds had been demanding �35m for the 23-year-old World Cup star, but have now accepted a lower offer.

The deal makes Ferdinand the world's most expensive defender for the second time.

His �18.5m move from West Ham to Leeds in November 2000 made him the world's costliest defender.

Ferdinand's trip over the Pennines to Old Trafford beats the �22.5m Juventus paid Parma for French international Lilian Thuram.

In signing Ferdinand, Manchester United have broken their own British transfer record, set when they paid Lazio �28.1m for Argentine captain Juan Sebastian Veron.

Leeds chairman Peter Ridsdale conducted the transfer from his holiday home in the south of France.

Ridsdale said: "The increase in Rio Ferdinand's valuation since his �18m transfer from West Ham clearly signals a significant return on our original investment.

"Subject to him agreeing personal terms and passing a medical, he will be a Manchester United player.

"Everyone at Leeds wishes him all the best in his future career."

Ridsdale spent Sunday morning locked in talks with Manchester United chief executive Peter Kenyon.

Leeds initially said a deal needed to be struck by 1200 BST for Ferdinand to move, but later dropped the deadline.

The deal brings an end to a dramatic and long-running saga transfer.

Manchester United have tracked Ferdinand from a long way out and his performances during the World Cup only increased their desire to sign him.

Ferdinand returned form the World Cup to a flurry of activity surrounding his future.

Speculation increased when Leeds sacked manager David O'Leary, leaving replacement Terry Venables with the dificult task of holding on to Ferdinand.

Ferdinand handed in a transfer request on 17 July, but it was immediately turned down by Ridsdale.