"Having taken time to consider every option in detail, I believe the decision to move to Toulon is the best decision for me and my continued development as a rugby player and as a person," said Halfpenny.
"I'm very excited about joining Toulon. They are an outstanding club, very ambitious, full of world class players and are the current European Champions so I'm very proud to have been given the opportunity to be part of that.
"Having said that I'll be incredibly sad to say goodbye to everyone at the Cardiff Blues, the fans, the squad and the staff.
"I've been very fortunate to have spent the last seven years there with great players and people and will always be a club that remains close to my heart. I have thoroughly enjoyed my time there, made some lifelong friends. I can't thank them enough for giving me the opportunity and for their continued support.
"I'm incredibly thankful to the WRU for their support. At this moment in time though I feel the decision to move to France is the best career opportunity for me personally as a professional rugby player.
"Toulon are fully supportive of my international desires and duties and I would like to thank them for this as it was an important factor in my decision.
"As well as the rugby challenges, I'm looking forward to experiencing and embracing a new culture and learning a new language. However until then I'm completely focused on performing for the Cardiff Blues and Wales."
The Gorseinon RFC product was capped at U16, U18 and U20 levels for Wales through the WRU academy structure before joining Cardiff Blues and earning his senior honours.
The Group Chief Executive of the WRU, Roger Lewis, said: "Leigh Halfpenny is a great player and a passionate Welshman so we all wish him well for the future.
"He wants to remain a Wales squad player and I know he will work as hard as he can to remain a contender for international honours with Wales.
"It is no secret that we are working closely with our Regions to put in place a new Rugby Services Agreement within which we hope to secure a method of retaining our top players in Wales and the WRU is anxious to progress that plan as quickly as possible.
"There is no doubt that playing in Wales under the gaze of our national coaches is the best place for any Welsh player to be but in this day and age we are all aware of the financial pressures on individuals to move.
"The player development structure we have in place through our academies, age grade teams and Sevens into the Regions and senior squad based at the WRU National Centre of Excellence is truly beyond compare.
"We want players to release their best options of being nurtured through their careers at the top is to be part of what we already do so well.
"Now is the time for us to all work together to ensure that our best players remain central to the pyramid of development within which they can achieve so much."