The Britain's Got Talent judge will record the event at the Royal Albert Hall in London on November 19, The Sun reports.
Walliams takes over from comedian Peter Kay, who hosted last year's Royal Variety Performance in Salford.
The Queen will attend the show, with performers said to include Robbie Williams, Kylie Minogue, Celine Dion and Placido Domingo.
Britain's Got Talent winners Ashley & Pudsey will also take to the stage as part of their prize for triumphing on the ITV1 show earlier in the year.
The Royal Variety Performance 2012 will air on ITV1 in early December.
Walliams recently signed a two-year deal worth an estimated £800,000 to remain a judge on Britain's Got Talent until 2014.
Watch Ashley & Pudsey perform in the Britain's Got Talent final below: