Vitaly Petrov will race for Caterham in 2012 with Jarno Trulli the driver to lose out.
Lotus' decision to sign Kimi Raikkonen and Romain Grosjean for the 2012 season left Petrov without a drive, but despite his axing the Russian had hinted that he would remain the sport.
Reports linking him with Caterham were dismissed by Trulli, who was still contracted to the team, but the squad have announced that Petrov will partner Heikki Kovalainen for the coming season.
"This is a very exciting day for me. I would like to thank Tony, Kamarudin Meranun and SM Nasarudin for giving me the chance to join a team that made its F1 debut at the same time as me, and has grown from one of the new teams to a serious force for future honours," Petrov said.
"The passion and spirit that Tony and the whole team have to keep moving forwards is infectious, and I am honoured to be able to join them and play my part in helping the team mount a serious challenge to the teams ahead in 2012 and for many seasons to come.
"I have been training hard all winter and am ready to get back into the cockpit and go to work. From what I have seen already, our new car is another good step forward from 2011 and now I cannot wait to see how it feels when we get to Barcelona. I would also like to take this chance to thank all my fans and partners for their support and their patience."
The decision to dump Trulli in favour of Petrov would appear to be financially motivated with the Russian bringing a new sponsor to the team, although Trulli was consistently beaten by Kovalainen last season.