Alex Tagliani will race for Bryan Herta Autosport this year as the team expands to run a full-time IndyCar programme.
Team boss Herta, whose outfit won the Indianapolis 500 with the late Dan Wheldon last year, had previously competed in selected races in collaboration with Sam Schmidt Motorsports, the squad for which Tagliani raced in 2011.
Herta, who has retained Todd Malloy to engineer Tagliani's car, thinks that the Canadian veteran's presence will help the team to thrive this season.
"We are very proud to have Alex Tagliani join our team for our first full season of IndyCar competition. He brings a wealth of experience and enthusiasm to the program, and is the perfect fit for us," Herta said.
"Together with Todd Malloy and Brian Page in engineering, and the Don Lambert-led crew, Alex has the full support of a very talented group of professionals behind him."
Tagliani, 39, was a race winner in Champ Car and switched to IndyCar competition in 2009. He took two pole positions last year - at the Indy 500 and the following race at Texas - to take 15th place in the standings.
"I'm really happy to drive for BHA. Having known Bryan for a long time, I recognise that he's a nice guy with genuine integrity. I believe that he and [team co-owner] Steve Newey deserve to own a great IndyCar team, and I'm honored to be part of the building of BHA's 2012 program," Tagliani said.
"It's also a great honour for me to represent the Lotus brand as a factory partner. Lotus has so much history in the world of motorsports. As a team, we have a lot of work in front of us and while challenging, it will be fun to be at the core of both engine and team development. BHA has a great group of people and I'm looking forward to working with them."
Herta's car will run in the black and gold livery made famous by Lotus during the early 1970s in Formula 1, thanks to its partner status. Tagliani will assist in the development testing of the Lotus engine before official running gets underway in February.