Diaz then joined the Pumas squad for the Rugby Championship and most recently played against South Africa in Soweto.
Highlanders general manager, Roger Clark said signing Matias was a real coup for the Highlanders.
"We're really excited about Matias joining the team for next season. There are not many quality tighthead props available in the New Zealand market, so to be able to confirm a young player of his potential is great news.''
Diaz will join the Highlanders squad after his international commitments in November.
Yesterday, the Highlanders confirmed the signings of forwards Tom Franklin and Gareth Evans on two-year contracts, while Japanese international halfback Fumiaki Tanaka signed on for one more season.
The Highlanders will announce their full squad for next season at the end of the month.