Palmer made his F1 test debut with Force India in Abu Dhabi in November, and thus had looked well set to land a role with the Silverstone-based team.
Team principal Gerard Lopez said: “Jolyon is a fantastic talent and a very credible driver to fulfil the role of Third Driver at Lotus F1 Team. Romain and Pastor are both GP2 Series Champions, so we know what a fantastic proving ground GP2 provides. For Jolyon to have enjoyed such a successful season as he took his title last year shows his superb potential for the future. We are looking forward to seeing him in team colours and behind the wheel of our 2015 car, the E23 Hybrid, which represents an exciting new era for Lotus F1 Team.”
Palmer added: “My goal has been to become a race driver in a competitive F1 team for 2016 and Lotus F1 Team is a great opportunity for me, particularly with Mercedes engines now. To be able to learn with a major F1 team by working closely with them in every area and getting a lot of mileage in the car is the best way possible, as Valtteri Bottas proved. I am delighted to be joining Lotus F1 Team at such an exciting time and my objective is to earn a long term future with them.”