The 21-year-old has played at the top level of Brazilian football since 2016, helping Paranaense to glory in the CONMEBOL Sudamericana in 2018 and picking up a runners-up medal in the CONMEBOL Recopa in 2019.
Lodi's arrival comes hot on the heels of Marcos Llorente's €30.2 million ($49.2 million) switch from Real Madrid, and head coach Diego Simeone has also added defender Felipe Monteiro in a €20 million ($32.7 million) transfer from Porto.
A statement announcing the deal to sign Lodi on Atletico's official website read: "Atletico Madrid and Athletico Paranaense have achieved a preliminary agreement over the transfer of Renan Lodi to our club.
"The agreement is pending its final formalisation both with the Brazilian club and the player.
"He comes with a notorious capacity to project himself in attack thanks to his versatility, speed, and great striking skills."