The singer-songwriter will top the bill, which also includes acoustic sets from Blur's Damon Albarn and Graham Coxon.
Talking about his headline slot, Sheeran said: "War Child does amazing music events for such a great cause. To be asked to play this year is an absolute honour."
Dry the River will also perform at the annual event. It takes place two nights before the Brit Awards on February 19.
Over the past three years, the concerts have raised over £500,000 for the War Child charity, which aims to protect and help children in war zones across the globe.
Sheeran is nominated in four categories for this year's Brit Awards, while Blur will take home the 'Outstanding Contribution to Music' prize.
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Watch the music video for Ed Sheeran's new single 'Drunk' below: