Rossi, the 19-year-old forward and Montevideo, Uruguay native, comes to MLS as the second youngest designated player in league history.
He scored 10 goals for Peñarol this season and helping lead the storied club to their 51st Uruguayan Club Championship.
“We are incredibly excited to announce the signing of Diego Rossi,” said LAFC General Manager and Executive Vice President of Soccer Operations John Thorrington in a statement. “We believe he will be a great asset on and off the field for LAFC and MLS. Diego is a player with great promise and international interest. It is another powerful statement from LAFC and our league that Diego is choosing to take the next step of his career in Los Angeles.”
“Diego is a young and exciting attacking player,” LAFC head coach Bob Bradley added. “His experiences at Peñarol and his ability fit perfectly with our vision of the team we are building at LAFC. We believe Diego will mature into a top-class player.”