Raikkonen, who had left Formula 1 at the end of the 2009 season after being dropped by Ferrari, had been in talks with the Williams team about a possible return next year, but the deal fell through.
That prompted speculation of a Renault tie-up, with team principal Eric Boullier confirming in Brazil last weekend that the Finn was on the shortlist of candidates for 2012 - when his outfit will be renamed Lotus.
Speaking about his return, Raikkonen said: "I'm delighted to be coming back to Formula 1 after a two-year break, and I'm grateful to Lotus Renault GP for offering me this opportunity. My time in the World Rally Championship has been a useful stage in my career as a driver, but I can't deny the fact that my hunger for F1 has recently become overwhelming.
"It was an easy choice to return with Lotus Renault GP as I have been impressed by the scope of the team's ambition. Now I'm looking forward to playing an important role in pushing the team to the very front of the grid."
Team owner Gerard Lopez added: "All year long, we kept saying that our team was at the start of a brand new cycle. Backstage we've been working hard to build the foundations of a successful structure and to ensure that we would soon be able to fight at the highest level."Kimi's decision to come back to Formula 1 with us is the first step of several announcements which should turn us into an even more serious contender in the future. Of course, we are all looking forward to working with a world champion. On behalf of our staff, I'd like to welcome Kimi to Enstone, a setting that has always been known for its human approach to Formula 1."
Raikkonen, 32, moved from Formula 1 to the World Rally Championship in 2010, where he spent the last two seasons while also competing in one race of the NASCAR Truck series and one Nationwide event.
The Finn won the Formula 1 world championship in 2007 with Ferrari, having scored a total of 18 wins since he made his grand prix debut in 2001.
Renault was forced to search for another driver after Robert Kubica confirmed last week that he would not be ready to start the 2012 season following his dramatic
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