Woosnam's selection was announced Wednesday by the European Tour's Tournament Committee, which also named Nick Faldo as captain of the Ryder Cup team in 2008.
Woosnam, winner of the 1991 Masters, has won 29 tournaments on the European Tour.
In Ryder Cup competition, he has an overall record of 14-12-5 with a singles mark of 0-6-2.
Faldo is a three-time winner of the Masters and also won the British Open three times.
Bernhard Langer was captain last year when the European squad routed the United States, 18 1/2-9 1/2.
Langer said he wanted to be a playing member this year and was not interested in being captain again.