Around 30,000 music fans are expected to attend the MTV Crashes Derry party, with a host of musical performances to be announced at a later date.
Tickets for the event will be released from 9 August and the concert will be broadcast across MTV's TV channels in October.
Over the weekend Ebrington Square will also play host to a number of other events which will include Club MTV DJs performing live sets and a local concert event run and promoted by Derry City Council.
Kerry Taylor from MTV UK said: "Londonderry is a fantastic city - steeped in history and named as 2013's City of Culture, so we can't wait to crash it.
"We look forward to working with local partners on the ground to stage a live music event that Derry won't forget."
Derry City Mayor Brenda Stevenson said hosting the live music event was a "huge coup" for the city and a key element of the Council's legacy promise for Music City 2014.
She added: "It promises to be a fantastic opportunity for us to showcase our city to a national and international audience.
"With a full weekend of activity, there will be music to suit all age groups. Today we are announcing details of the MTV music event which will be attractive to our young people in the city and wider region to experience one of the biggest music parties of the year."
The event follows on from Mark Ronson's MTV concert in Belfast in 2010 as part of what would become the MTV Crashes series.
The MTV European Music Awards were also held in Belfast in 2011 and featured a spectacular free concert by Snow Patrol at City Hall.
The following year MTV also held a special concert at Titanic slipways featuring artists including Pixie Lott and Katy B.