Due to popular demand and their increasing profile in the US, the boyband will play the iconic venue on December 3 following their North American tour in May and June.
"We are so happy to be playing Madison Square Garden," said Niall Horan.
"To be headlining our OWN show in a venue that has played host to countless legendary acts that we have grown up listening to and adore is obviously a dream come true for us all. We can't wait to play for our fans on December 3rd."
One Direction recently made US chart history by becoming the first British group to top the Billboard 200 with their debut album Up All Night.
The boyband will perform their international hit 'What Makes You Beautiful' on an episode of Nickelodeon's iCarly on April 7 as well as being the musical guest on Saturday Night Live later that evening.
Tickets for One Direction's Madison Square Garden show go on sale from 5pm ET on April 6.
> One Direction's 'What Makes You Beautiful' to be covered on 'Glee'
Watch the music video for One Direction's 'Up All Night' below: