Aloft London Excel will offer 252 rooms and is being developed by Abu Dhabi National Exhibitions Company (Adnec), the parent company of Excel London.
The hotel is scheduled to open at the end of 2011 and will be situated at Excel London's east entrance at Royal Victoria Dock with direct access to Prince Regent Station on the Docklands Light Railway and London's International Convention Centre.
It will be the first Aloft property in the UK, and the second in Europe, following the planned opening of Aloft Brussels Schuman this autumn.
Excel London chief executive Kevin Murphy said: "We have been working closely with Starwood to bring the Aloft brand to London."
ADNEC chairman Sheikh Sultan Bin Tahnoon Al Nahyan said: "Aloft London Excel will support Excel's growing events calendar and the London Olympics by providing quality, stylish and affordable accommodation."
The signing of Aloft London Excel is part of an international expansion of the brand, which debuted in Canada in June 2008 and has since grown its portfolio to almost 50 hotels in the US, China, Canada and the United Arab Emirates.
Aloft properties are set to open in Belgium, India, Thailand and the Middle East over the next two years.