McStay has long been anticipated to join the Magpies this off-season, with the Lions confirming the 27-year-old would depart their club last month after nine years with Brisbane.
Exercising his rights as an unrestricted free agent, McStay will join Collingwood on a reported five-year deal worth $3 million.
With Brisbane opting not to match the magpies' offer, they will receive Pick 35 for the 2022 National Draft as compensation, adding to their hand of 15, 34, 45, 71 and 89.
McStay joins now-former Giants forward Bobby Hill in heading to Collingwood this week, while the Magpies are in a position to sign other targets in Billy Frampton (Adelaide), Brayden Fiorini (Gold Coast) and Tom Mitchell (Hawthorn).
McStay played 161 games for Brisbane, booting 138 games after predominately playing as a forward for the Lions.