Frenchman stood in for Bruno Senna during practice at Yas Marina Circuit and now replaces the Brazilian on a permanent basis at Lotus Renault.
Romain Grosjean lands Formula One drive after Abu Dhabi showing
Lotus Renault said in a statement that the Frenchman, who was a reserve driver during last season's F1 championship, impressed during practice sessions at Yas Marina Circuit and the Brazil Grand Prix at the end of the season. His appearance in the first practice session in Abu Dhabi was his first in a grand prix session since being dropped at the end of 2009. Driving in place of Brne Senna, he set the 12th fastest time during first free practice.
"I am thrilled to be one of the team's race drivers in 2012," Grosjean said. "There's a big grin on my face at the prospect of getting behind the wheel of next year's car.
Grosjean will drive alongside former world champion Kimi Raikkonen next year. Russian driver Vitaly Petrov and Senna now both have to look for a new team.
"To be racing alongside a former world champion and someone who is hungry and returning to Formula 1 will be a great experience," Grosjean said.
Lotus team principal Eric Boullier said: "I would like to thank Vitaly Petrov and Bruno Senna for their contribution to the team's performance this year and I wish them all the best for the future. Romain has shown a lot of maturity in the past twelve months both through his GP2 Series victory and his development as third driver with us."
Grosjean won the GP2 Series championship this year. He was previously a test driver on the Renault F1 Team in 2008, and got a race seat in the second half of 2009.
"I feel that my successful season in GP2 Series has helped me mature a lot, and I am a much more complete driver than I was last time I was competing in this sport," Grosjean said. "I will not disappoint and I wish to thank all the people without whom this return to F1 would not have been possible."