The champions will meet in the game unless one or both are selected to play in the new four-team postseason model, in which case the most deserving team from each conference will be selected.
Both sides are excited about the move and its implications for the two conferences.
"Our goal is to provide the fans across the country with a New Year's Day prime-time tradition," said interim Big 12 Commissioner Chuck Neinas. "This is a landmark agreement between two of the most successful football conferences during the BCS era to stage a postseason event. The creation of this game featuring the champions of the Big 12 and SEC will have tremendous resonance in college football."
"I am very excited by the prospects for a game between our champion and the champion of the Southeastern Conference," said Bob Bowlsby, who will take over as Big 12 Commissioner June 15.
SEC Commissioner Mike Slive had similar sentiments.
"A new January bowl tradition is born," Slive said. "This new game will provide a great matchup between the two most successful conferences in the BCS era and will complement the exciting postseason atmosphere created by the new four-team model. Most importantly, it will provide our student-athletes, coaches and fans with an outstanding bowl experience."
The name and host site of the bowl game is still to be announced at a later date, although Neinas confirmed to CBSSports.com's Dennis Dodds that the "Champions Bowl" was the working title for the new game.
As far as the two conferences and their success during the 14-year BCS era, they lead the nation with 11 seasons in which at least one has finished in the top four of the final standings.
Both have put 14 teams inside the top four of the final BCS standings, sharing the top spot all-time in that category.
The SEC leads with nine BCS National Championship Game appearances, while the Big 12 has had seven, combining for 16 total amongst the new partners.
Big 12 and SEC Champions have met twice in the big bowl, with the SEC claiming both National Championship Games. Alabama beat Texas 37-21 in 2010 in Pasadena, Calif., while Florida topped OU 24-14 in 2009 in Miami, Fla.