The move marks Hamilton's first foray into team management, with his squad's X44 name referencing the number he has carried on his Mercedes F1 car since 2014, reports Xinhua news agency.
However, Hamilton will not drive or be involved in the day-to-day running of the outfit as he is all but certain to remain in F1 with Mercedes for 2021 and beyond.
"It's an exciting new project and it will be fun to have a different role from being the driver," said Hamilton.
The all-electric Extreme E series aims to highlight the impact of climate change, help rebuild affected communities and promote the use of E-vehicles.
Likened to an electric version of the famous Dakar Rally, the 2021 season will take place across five locations that are under threat from climate issues, with teams to run male and female driver pairings.
"What is most appealing is that Extreme E will be not only raising awareness of some of the most critical environmental issues, but also working with local charitable organisations to leave a long-lasting legacy of change," added Hamilton. "It means so much to me that I can use my love of racing, together with my love for our planet, to have a positive impact."
Extreme E founder and CEO Alejandro Agag added: "We are thrilled to welcome Lewis Hamilton and his X44 team to Extreme E. Like us, Lewis is hugely passionate about motorsport, but also shares our belief that we can use sport to highlight subjects which are vital to the world, such as climate change and equality."
"Lewis is one of the most successful drivers of all time, and we're all excited to see how his X44 team performs on and off the race track under his incredible guidance."
Despite the disruption to global sport caused by the Covid-19 pandemic, Agag told media in April that the series was still on track to begin as planned in Lac Rose, Senegal in January 2021.