Farah will race in the 5,000m on July 13th - just over three weeks before he is expected to line-up in the Olympic 10,000m final, where he'll seek to upgrade his silver from last year's World Championships in Daegu.
“It’s nice to race back home as I miss London and it’s not until you’re back you realise how much you miss it," said Farah, who trains full-time in Oregon.
“At Crystal Palace we always get a great crowd and I’m really looking forward to competing on home soil before the Olympics. I think home support really gives British athletes an edge over our rivals, and that support will not only make a massive difference to us at Crystal Palace but also at the Games.
“The London Grand Prix is always one of the most exciting events on the Diamond League circuit. As it’s over two days, it always attracts the best athletes so it’s a great way to prepare for the summer ahead.”
Farah enjoyed an mixed winter season, setting a new British and European indoor record over two miles in February before he narrowly missed out on a medal in the 3,000m at the World Indoor Championships in Istanbul.
But for Farah, whose wife Tanya is expecting twins in September, remains upbeat his preparations are on track.
“Things are going well," he said.
"I’ve had a good winter racing different distances to build up my speed and I’m feeling good going into the summer. I’m definitely where I need to be but there is still a lot of work to be done before August.
“It’s an exciting year for me and my family, so I’ve just got to keep my feet on the ground and continue doing what I’m doing. It’s an amazing year for British sport and I can’t wait to be a part of it.”