In a deal that unfolded at AFL House on Friday morning, the Demons gave up picks No.2, No.20 and No.72, receiving Tyson and picks No.9 and No.53.
Check out the current draft order following the Tyson trade
It is understood the Giants will not trade pick No.2, with classy youngster Josh Kelly believed to be in their sights.
After speculation the Giants could package young players together to land pick No.2, Tyson emerged is the only player involved in the trade.
The 20-year-old was originally selected at No.3 in the 2011 NAB AFL Draft.
"We’ve been able to bring in a class midfielder in Tyson, and improve our second draft selection from pick 20 to pick 9 in what we see as a fairly even draft," Melbourne football manager Josh Mahoney said.
"We have also been able to improve our pick 72 to pick 53, so the net effect of the deal is very positive for the Melbourne Football Club.
"Dom comes with a good strong character, and fits the age and positional profile that we need to improve upon. He complements our young core of midfielders who can grow together over the next 10 years."
Tyson had suffered from homesickness during his time in Sydney and held talks with Richmond late last year about a return home to Melbourne.
In February this year he re-signed with the Giants until the end of 2015, telling AFL.com.au at the time he "had unfinished business" at the club.
One of the Giants' record eight NAB Rising Star nominations in 2012, he suffered a serious knee injury in the lead-up to this season, keeping him out of the senior side until round 16.
He made just three appearances this year, taking his career tally to 13.
Dogged by injuries during his time at the club, he is a skilful midfielder also capable of drifting forward and kicking goals when fit.
The former Oakleigh Charger kicked the Giants' 2012 goal of the year for his running effort from the boundary against the Brisbane Lions in round eight that season.
A combination of draft concessions and trades gave GWS 11 of the first 14 picks in the 2011 NAB AFL Draft, including the first five overall.
Ahead of last year's draft, they traded the rights to then-17-year-olds Jack Martin and Jesse Hogan to Gold Coast and Melbourne respectively in return for picks No.2 and No.3.
This year the Giants have the first overall pick for the third consecutive year, which they are expected to use on Tom Boyd.
Following a one-win season in 2013, GWS has also managed to add some experience to its fledgling list during this year's trade period.
Premiership players Shane Mumford and Heath Shaw have agreed to join the club, pending trades, while the Giants have also been linked to Bernie Vince, Sam Fisher and Josh Hunt.
The GIANTS will have picks 1 & 2 in this year's draft after a deal exchanging Dom Tyson & draft selections to @melbournefc. More to come.
— GWS Giants (@GWS_Giants) October 17, 2013
We have secured outstanding young Greater Western Sydney midfielder Dom Tyson, plus picks No.9 and No.53 -http://t.co/J9Q8xYHp5o— Melbourne FC (@melbournefc) October 17, 2013