The 21-year-old is the reigning DTM German Touring Car champion and was Mercedes' test driver in 2015.
Wehrlein has signed a one-year deal with Manor, which has recently begun an engine partnership with Mercedes.
The other seat is still up for grabs with Alexander Rossi and Will Stevens, who both raced for Manor Marussia in 2015, still in with a chance of being offered a new deal.
Stephen Fitzpatrick bought the team when it was in dire straits a year ago, and has started a major rebuilding job.
“Pascal is a sharp driver with a very promising future, “ he said. “Manor is small team up for a big challenge this season, so we've chosen a driver with the talent and hunger to match our own on-track ambitions.
“Pascal was impressive in testing for Mercedes and Force India, and we’re perfectly placed to help Pascal make a big impact in his first season.”
Wehrlein will take part in both pre-season tests, the first of which is scheduled to start in Barcelona on 22 February.
Previously known as Marussia, the team has only picked up points in one race, the 2014 Monaco Grand Prix where the late Jules Bianchi finished ninth.
But Wehrlein is confident of helping the team become more competitive.
“Manor Racing is a great place for me to start my Formula One racing career,” he said. “It will be a tough challenge but I think we should be able to challenge for points along the way.”
Compatriot Ralf Schumacher says Wehrlein's arrival in F1 will be a boost for the sport in Germany which now has four drivers at this level.
“It's good for motorsport in Germany to have another talented, aspiring pilot in Formula One,” said the younger brother of seven-times world champion Michael.
“His performance in DTM series was impressive and he has earned his chance in a Formula One cockpit.”
The 2016 season will start in Melbourne on 20 March 20.
Original source: New German driver joins F1