The GAME Group is the first retailer in the world to offer a strategic partnership with the cloud gaming initiative.
Starting with its GAME and GameStation websites, the firm will sell its television-enabled Game System, Wireless Controller and digital offerings to millions of customers across the UK.
OnLive hardware will later be sold in 615 GAME and GameStation stores across the country within the coming months.
Meanwhile, BT will offer its customers three months' free access to the PlayPack subscription from launch.
A PlayPack subscription, which otherwise retails for £6.99 per month, provides open access to over 100 titles.
The promotion is available to any BT customer over the age of 18 who registers by January 31, 2012.
"This is a fantastic new service for the UK. The three months' free PlayPack subscription is a great offer for BT Broadband customers and there are no strings attached," said customer service managing director Warren Buckley.
"It's not part of a contract and we're waiving usage allowances until the New Year. We just want to give our customers the chance to try it, and with more than 100 premium games available, choosing what to play will be the hardest part."
OnLive CEO and founder Steve Perlman added: "OnLive is an entirely new way of experiencing top-tier video games, anywhere, anytime and on virtually any connected device, whether TV, PC, Mac or tablet, with awesome cloud-powered features and community unlike anything you've ever seen before. UK gamers, welcome to OnLive!"
Launching across the UK from today, OnLive provides instant on-demand gaming that can be streamed to multiple devices, including PCs, Macs and television sets.
Other launch promotions include a first-game purchase for £1 and free OnLive hardware at this weekend's Eurogamer Expo.
> OnLive launches across the UK: First game purchase only £1
Watch a video of OnLive's 2011 lineup below: