The Mexican teenager is yet to play for The Gunners as the Under 20 international does not quality for a work permit.
He has already been out on loan at Celta Vigo and Salamanca, and was wanted this summer by Levante and Almeria.
But Vela's agent Eduardo Hernandez has revealed the forward has agreed to join Osasuna for a year, with the option of a second season.
"It is a fact, the player goes away to Osasuna," Hernandez told Marca.
"The negotiation has been closed for a loan for a year and with the possibility that it is extended to two, but an option to buy has not been contemplated.
"For Arsenal, it interests them that he plays regularly and he will do that in Osasuna.
"Vela is very happy, it is incredible what he has done. At 17 years, he played in the second division and at 18 in the first with Osasuna."
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