The Italian sprinter is currently riding with the Bardiani Valvole-CSF Inox Professional Continental team but will pull on Lampre-Merida's pink and blue kit and be one of the team's protected sprinters.
Modolo has won 24 races since turning professional in 2010, using his sprint and climbing ability to successful effect. He finished fourth in Milan-San Remo in his first season and recently won six stages at the Tour of Qinghai Lake in China and was second in the RideLondon-Surrey Classic.
"Modolo has shown what he can do in his first years as a professional, combining his speed and resistance to win numerous races," Lampre-Merida team manager Giuseppe Saronni said in a statement announcing Modolo's signing.
"He's maturing year after year and he's at a excellent level and we hope he can go up against the best sprinters in the world on a world stage. He's charismatic and one of the best Italian fast finishers. I'm sure he'll fit in well in our group."
Lampre-Merida has had a poor season so far, with the Mantova investigation and trial casting a shadow about the team's past. Filippo Pozzato struggled in the Classics, while Michele Scarponi fought back to finish fourth in the Giro d'Italia.
Lampre-Merida has already extended Diego Ulissi's contract and is expected to sign other riders before the end of the season. The Italian team has been linked to double Tour de France stage winner Rui Costa.