He'll be joined by the likes of Wolf Alice, Skepta, Sigrid and Panic! At The Disco who also appearing.
It is fair to say Lamar is quickly becoming one of the most significant rap artists of all time, and in August festival-goers will be able to see him take the main slot for the first time.
He first played the event in 2015.
But the rapper is not alone - he will be joined by an eclectic mix of alternative rock, pop and grime, with the likes of Wolf Alice, Skepta, Sigrid and Panic! At The Disco also appearing.
"There are very few places that can illustrate the growth of our band from its beginning. However, Reading and Leeds is one of them," said Fall Out Boy in a statement.
"It is an honour to be able to headline a festival that we grew up playing and dreaming of that top spot."
Festival organiser Melvin Benn said: "Reading and Leeds prides itself on being a music-first festival and this year's line-up already proves that.
"Kings Of Leon and Fall Out Boy are bands that have grown with the festival and its fans, and we couldn't be more pleased to invite them back to headline.
"Adding Panic! At The Disco and Kendrick Lamar, probably the most sought-after act in the world right now, we think Reading and Leeds festivals 2018 are off to an amazing start - with even more to come, so watch this space."
Other acts include Post Malone, Dua Lipa, Sum 41, The Courteeners and The Wombats.
The festivals take place at Reading's Richfield Avenue and Brahman Park in Leeds from 24-26 August.