The former national carriers will be listed under their new name in markets in London and Madrid from 8am.
BA and Iberia will retain their brands in the initiative, which is expected to save 400 million euros (£337.3 million) a year by its fifth year.
The combined group will have 419 aircraft flying to 205 destinations and will be Europe's second largest airline by market value after Lufthansa.
BA will also benefit from Iberia's strong presence in South America, where BA operates only a handful of routes.
The newly formed group plans to aggressively expand through further acquisitions and has drawn up a list of 12 companies it wants to buy. Willie Walsh has stepped down as chief executive of BA to take up the same role at International Consolidated Airline Group.