Félix became Atletico's club-record signing when he joined in a €126 million ($137m) deal from Benfica in July 2019, but he struggled to make the intended impact, scoring 34 goals in 131 games for Atletico.
He was sent on loan to Chelsea in January, where he was sent off on his debut and could not fix their goal-scoring issues, netting just four times in 20 appearances. Chelsea appointed Mauricio Pochettino this summer, and the Argentine boss indicated he did not want to sign the 23-year-old forward.
The arrival of Cancelo brings an end to the LaLiga club's search for a right-back this summer.
Barca coach Xavi Hernández has been keen to strengthen his options at the position, having previously used centre-backs Jules Koundé and Ronald Araújo in the position, and having allowed Sergiño Dest to join PSV Eindhoven.
Also on deadline day, Barcelona announced the loan signing of defender Mamadou Fall from MLS club LAFC. Fall, 20, will join Barcelona's B-team on loan for the season with an option to make the move permanent next summer.
Born in Senegal, Fall has made 36 MLS regular-season appearances for LAFC after joining in 2021. He already has experience in Spain, having spent last season on loan at Villarreal.
Barca said in a statement the agreement includes a buy-back clause and they retain a 50% of Abde's ecomomic rights for any future transfer.