Raikkonen will miss the United States Grand Prix and Brazilian GP after undergoing successful back surgery on Thursday at the University Hospital of Strasbourg. He is joining Ferrari next season.
The 32-year-old Kovalainen has raced in 109 GPs for Renault, McLaren and Caterham, securing one win at the Hungarian GP in 2008 and three other podium finishes. He has been a test driver for Caterham this year.
"Jumping into a car so late in the year when you have not been competing in the races all season will be a challenge, but I know the team at Enstone well so I have no concerns about getting up to speed,'' Kovalainen said. "This is a great opportunity for me, so I would like to thank Tony Fernandes and Caterham F1 team for allowing me to take advantage of it.''
His appointment comes after seven-time champion Michael Schumacher turned down Lotus' offer to drive in the final two races.
"We had to move quickly following the news of Kimi's non-participation in the final two races of this season, and we found ourselves facing a difficult decision,'' Lotus team principal Eric Boullier said. "On the one hand we had our reserve driver Davide Valsecchi -- who is a talented young driver that has shown a great deal of promise -- and on the other we had the opportunity to bring in a seasoned Formula One competitor.''
Before making his decision to have surgery, the 34-year-old Raikkonen had criticized the team for not paying his salary this season and threatened to pull out of the final two races in protest.
He had to be persuaded to race in Abu Dhabi but skipped his media obligations on the Thursday before the race. He pulled out of the race on the first lap because of suspension damage after a minor collision.
Before that, tensions had surfaced within the team at the Indian GP. Raikkonen was upset when he was ordered by the team's trackside operations director, Alan Permane, not to hold up teammate Romain Grosjean.