Elite-level cyclists will race past historic city sites, through Castle Gardens and along the banks of the River Soar this summer.
The Leicester Castle Classic cycle race will be held on Sunday, August 18.
It is hoped the event will attract elite-level teams for the headline race, although amateur cyclists will also have the opportunity to try race the circuit with a junior race, corporate challenge, and "choppers and shoppers" event planned.
Details of the circuit are still being finalised, but organisers have confirmed the two-hour race will take place around Castle Gardens in the city's Old Town, and along the banks of the "mile straight" stretch of the River Soar.
The inaugural event is being run by Leicester City Council and British Cycling.
City mayor Sir Peter Soulsby said: "British Cycling's success at last year's Tour de France and the London 2012 Olympics has given cycle sport a massive boost.
"It is fantastic our partnership with British Cycling means we are able to bring the spectacle of elite-level cycle racing back to Leicester.
"The Castle Classic bike race is set to be a highlight of our fantastic Summer in the City programme.
"The number of people cycling in Leicester grows every year. This race, and Leicester's popular Sky Ride, are both great ways of celebrating this achievement."
The six British domestic teams taking part are likely to include riders of the calibre of Kristian House, who won the King of the Mountains section of last year's Tour of Britain race.
Jonny Clay, British Cycling's cyclesport and membership director, said: "This event is a great addition to the calendar and one we hope to see establish itself for the long-term in a city with such a rich cycling heritage."
Races will run from noon until 6pm on traffic-free roads, with entertainment, refreshments and opportunities to give cycle sport a go available in the race village.
Eric Ludlow, of the Leicester Cycling Campaign Group, said: "We've not seen a race round the city for some time now. It will be a rare spectacle, even for people not that interested in cycling."
Non-racers will also have the opportunity to ride parts of the circuit themselves the following weekend, when Sky Ride Leicester returns to the city centre on Sunday, August 25.
In the meantime, people can register for Skyride at:
www.goskyride.org/leicester
www.britishcycling.org.uk
