It will be the second hotel in the UK for Belmond, alongside Raymond Blanc's Le Manoir aux Quat'Saisons in Great Milton, Oxfordshire.
The 64-bedroom hotel will close at the end of this month for a £28m renovation, reopening in summer 2016 as the 54-bedroom Belmond Cadogan.
Located on Sloane Street, the Queen Anne style property, which was built in 1887, will be reconfigured to provide larger-sized suites in response to demand from guests.
GA Design International will create the new interiors, with funding from the owners, the Cadogan Estates, which bought the property in 2011 for £15.4m from US-based Trinity Hotel Investors. The deal enabled Earl Cadogan to take control of the hotel which bears his family name.
The Belmond Cadogan will feature a new "gourmet dining experience", with a direct entrance on to Sloane Street and overlooking Cadogan Place Gardens.
John M Scott, president and chief executive officer of Belmond, said that the new look Belmond Cadogan is set to become one of London's foremost luxury hotels.
"With its incredible heritage, unrivalled location and contemporary classic design, Belmond Cadogan will be renowned for its understated glamour and unique character, as well as for its standards of excellence in service and hospitality," he said.
Hugh Seaborn, chief executive of Cadogan Estates, added: "The Cadogan has a colourful history - once home to Lillie Langtry where she courted the future King of England and also the location of Oscar Wilde's infamous arrest - and a wonderful future.
"With its depth of experience overseeing the sensitive renovation of historic buildings and track record in luxury hospitality, Belmond is the perfect partner for us to preserve the Cadogan's unique heritage, while evolving the hotel into a luxury retreat for today's luxury traveller."
Belmond has a portfolio of 45 hotel, rail and river cruise experiences worldwide, including the Belmond British Pullman, Belmond Northern Belle and Belmond Royal Scotsman trains.