The Wasps man received the nod ahead of regular 13 Jonathan Joseph, who has been battling a groin injury but is named among the replacements.
Flanker Tom Wood, dismissed by coach Eddie Jones a year ago as "distinctly average" and flying winger Jonny May, who suffered a serious knee injury in December, make their first appearances since the World Cup as Jones was forced into a raft of changes due to injuries.
Joe Launchbury and Courtney Lawes will lock the scrum in the absence of Mario Itoje and George Kruis while Marland Yarde is back on the left wing.
An uncapped trio of prop Kyle Sinckler, number eight Nathan Hughes and centre Ben Te'o were named among the replacements.
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"With a few influential players not available for selection this is a great opportunity for some of the new faces to put both feet forward," Jones said.
"I’m also pleased to see a number of returning players get their chance on Saturday, most notably Jonny May after his long injury rehabilitation and Joe Marler, whose attitude and application to training these last two weeks has been first-class."
Daly is the most eye-catching selection, not least because Joseph has performed so well as first choice in every one of Jones' nine games - and nine wins.
"Elliot has been there or thereabouts for the past five or six tests, he gives us a left-foot option out wide, is a strong runner and a great defender," Jones said.
Daly has happy memories of Twickenham having twice helped Whitgift School take the Schools Under-18 Cup there – once alongside Yarde, who scored a hat-trick in the 2010 final.
Daly was in Stuart Lancaster’s training squad for the 2015 World Cup but did not make the final cut, a decision he described at the time as "devastating."
He has come off the bench five times under Jones, three in the Six Nations and two on the Australia tour, and, like the coach, has yet to taste defeat.
He has explosive speed and quick feet but at 5ft 10 (1.77m) and not much over 13 stone (83kg) he is slight compared with most modern centres and there were concerns about his defensive solidity at the highest level.
Jones, however, has seen enough in camp to throw him in for possibly the most physical examination of all - a test against the Springboks.
As a left footer he gives England an extra kicking option and could also be useful as an emergency long-range goalkicker, having famously landed two from the Twickenham halfway line as an 18-year-old in his schooldays.
South Africa, who have not lost to England for 10 years but struggled for form in the Rugby Championship, name their team later on Thursday.
(Editing by Pritha Sarkar)
