Current world No 1 women's player Serena Williams will headline this year's Polo Open, which will be held in the city in mid-September.
Tournament organizers earlier last week announced the Wimbledon champion had confirmed she would compete in the US$585,000 event but expressed concern about Williams' injuries that have forced her to withdraw from a series of warm-up matches ahead of this month's US Open.
"She is without doubt the most wanted player of every tournament in the world," said Michael Luevano, tournament director of Polo Open.
Earlier reports in Chinese newspapers said organizers would pay an "appearance fee" of about US$300,000 to secure Williams' presence at the tournament, a Tier-II event on the WTA annual tour.
Polo Open will replace the Princess Cup, traditionally held in Tokyo, Japan. Dentsu Group, which owns the Princess Cup, decided to move the tournament to Shanghai, which has hosted a US$140,000 WTA Tier-IV event for the past three years.
Willams is the defending champion at the Princess Cup, where she defeated Belgian Kim Clijsters in the final in three sets last year.
"It's a big achievement to have her play here at Shanghai Polo Open," said Luevano.
The tournament director admitted he was a little worried about Williams' injuries, but he expected she would recover before the event as "she is a woman of incredible physical resilience."
Williams pulled out of the Acura Classic in Washington last week because of a left leg injury. A knee problem caused her to withdraw from the earlier Bank of the West Classic at Stanford, and injuries forced her to skip this week's J.P. Morgan Chase Open in Los Angeles.
Williams underwent surgery last Friday to repair the injury to her knee.
Among the other players confirmed for the event are Ai Sugiyama, No 11 on the WTA ranking, as well as Conchita Martinez from Spain, No 14.
Other noteworthy players include Ashley Harkleroad from the US (No 42), Austrian Barbara Schett (No 54), Maria Sharapova from Russia (No 57) together with her fellow Russian Dinara Safina (No 50), Marat Safin's younger sister.
Organizers have confirmed 21 of the 32 main draw candidates so far, leaving places open for other top players or players with a high market value to sign up.