The inaugural Next Gen ATP Finals will be held over five days at the Fiera Milano stadium from Nov 7-11 and will be staged there until 2021. Only players aged 21 and under will be eligible with qualification being decided on ATP Race rankings.
The top-seven points earners in the age bracket will be joined by one wildcard.
"What we need to do as the ATP, we have a responsibility to market many more players to a much wider audience," ATP chief Chris Kermode told a news conference in London on Saturday.
With the likes of Roger Federer and Rafa Nadal, who have 31 majors between them, starting to slow down and Andy Murray and Novak Djokovic both 30 next year, Kermode said it was important to prepare for the inevitable changing of the guard.
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"We have superstars in the game that have transcended the sport over the last 10 years, reached beyond tennis and become global sporting icons, Roger, Rafa, Novak and Andy in particular," he said.
"Changing of the guard is coming. We have a duty to start highlighting and really bringing to life characters in the game that are coming through with immense talent.
"This event will provide a platform for the stars of the future to showcase their talents on a global stage."
The tournament is expected to be used as a trial for various rule changes and innovations.
"People throw out ideas, getting rid of this, making it quicker, longer, whatever you have to say," he said.
"I think we have to put it in an event and test case all this stuff. Until you see it, it's difficult to see whether some ideas work or not."
With several players aged under 21 already making inroads at the top of the rankings, it is possible the likes of German teenager Alex Zverev, who finished the year ranked 24th, could qualify for both end of season events next year.
"We've said that if a player makes the ATP World Tour Finals, they don't have to play," Kermode said.
"I've spoken to two players that said they would play if they made both. I'll believe it when I see it, but they said it."
(Reporting by Martyn Herman; Editing by Larry Fine)
