"We have signed a two-year contract together with the clear aim of building an ambitious project that should see him develop and be taken to the pinnacle of MotoGP," said team boss Fausto Gresini in a statement at the British Grand Prix.
Redding, who leads Spain's Pol Espargaro by 21 points in the standings going into his home race at Silverstone, said he was up for the challenge with the non-factory team.
"I'll be racing alongside the best riders in the world, aboard the brand-new Honda production racer, so I know already how steep a learning curve it's going to be," said the 20-year-old who is challenging to become Britain's first world champion in any class since Barry Sheene in 500cc in 1977.
Redding became the youngest rider to win a motorcycle grand prix with a 125cc victory in Britain in 2008 at the age of 15.
His team mate next year will be experienced Spaniard Alvaro Bautista, a former 125cc champion.
Espargaro will also move up to MotoGP next year with the Yamaha Tech3 team.
(Reporting by Alan Baldwin; editing by Tony Jimenez)
