The concert, called, "Let's Go Crazy: The GRAMMY Salute to Prince," will take place on January 28 in Los Angeles and will be taped for broadcast later in the year.
Its star-studded lineup includes John Legend, Foo Fighters, Alicia Keys, Juanes, Coldplay's Chris Martin, Usher, and Earth, Wind & Fire, among other artists.
The "Purple Rain" singer had won seven Grammy Awards and was nominated 38 times, the academy said.
"With his subversive attitude and commanding nature, he straddled musical genres and created electrifying music that was bursting with character," Recording Academy President and CEO Deborah Dugan said in a statement. "He continues to serve as an inspirational icon for artists and fans worldwide."
Prince passed away in 2016, just weeks after striking a deal to write a book about his life.
His memoir, which came out last year, is titled "The Beautiful Ones" and combines the singer's unfinished manuscript with original photos, scrapbook clips and lyric sheets.
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