The 27-year-old will join the Dragons for the 2021 and 2022 seasons.
Alvaro has played 95 NRL matches since making his NRL debut for the Eels in 2015, including six matches on loan to the Warriors this season.
“Daniel has shown his competitiveness and capabilities as a first grade player over the past six years and we’re excited to see how he complements our squad,” Dragons general manager of football Ben Haran said.
“Head coach Anthony Griffin oversaw Daniel’s development in the Under-20s during their time at the Brisbane Broncos together.
“Their long-standing relationship can only be a positive and will certainly help Daniel settle into his new surroundings over the remainder of our pre-season.”
Parramatta confirmed they had granted Alvaro a release from the remainder of his contract.
The front-rower won the Ken Thornett Medal as Parramatta’s player of the year in 2018, but in recent times had struggled to earn a spot in the the Eels first-grade side. He played just eight games in 2020, six of those for the Warriors.
Under new coach Griffin, the Dragons have signed Jack Bird from Brisbane for 2021, along with front-rower Poasa Faamausili from the Roosters.
There’s still a number of spots to fill on the club’s roster, following the depatures of Tyson Frizell, Euan Aitken, James Graham, Jacob Host, Korbin Sims and Jason Saab.
The Dragons open their 2021 campaign against arch-rivals Cronulla in round one.
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