Chris Pither will replace countryman Fabian Coulthard at PremiAir Racing in 2022.
Pither is set to drive alongside Garry Jacobson, who has also been confirmed in the team's maiden Repco Supercars Championship driver line-up.
Speculation was rife regarding the driver line-up at the new-look team, which was recently bought by drag racing veteran Peter Xiberras.
All the moves: 2022 Supercars grid finalised
It was confirmed last week that Xiberras had purchased the team, and its two Racing Entitlements Contracts, from Jonathon and Kobe Webb.
However, both Coulthard and fellow Team Sydney incumbent Garry Jacobson remained contracted with the Webbs.
Coulthard has been released, opening the door for Kiwi veteran Pither to make a sensational return to full-time Supercars competition.
Pither's last full-time start came in Bathurst in 2020
It also ensures Coulthard will be without a full-time drive for the first time since 2005, and he now looms as a key figure in the co-driver market.
Pither, the 2018 Dunlop Super2 Series winner, has been confirmed on a one-year deal with the Xiberras squad.
Pither, who co-drove with Macauley Jones in 2021, has history with the former Tekno squad.
In 2020, the New Zealander was recruited by Team Sydney for its first season, and raced in Coca-Cola colours.
He departed at the end of the season and was replaced by Coulthard, who had departed DJR Team Penske.
Jacobson joined from the downsized Kelly Racing, with Alex Davison also leaving Team Sydney.
Pither made his main game in 2006, with his first full season in the championship coming in a satellite Tickford Ford in 2016.
That year, Pither raced under the Super Black Racing and recorded a surprise ARMOR ALL Pole Position at Queensland Raceway.
The 13-event 2022 Repco Supercars Championship will commence in Newcastle in March. Tickets for the event are on sale now.
CLICK HERE to view the 13-round draft 2022 calendar.