The standalone event will be held in Stellenbosch, South Africa on 28 and 29 March and see teams from all six World Rugby regions competing to win a core spot on the Women's World Series in 2021.
The challenger series is designed to boost rugby sevens' development across the globe and will evolve to feature more tournaments as it grows and develops in future years.
"World Rugby is heavily committed to growing the women's game," said World Rugby chair Sir Bill Beaumont.
"The women's competition on the HSBC World Rugby Sevens Series has expanded from six to eight rounds this season and teams are more competitive than ever, demonstrating the need and appetite for more women's teams to be playing Sevens at a high level with a clear pathway to progress to the very top of rugby Sevens."
The PNG Palais qualified for the challenger series after finishing fourth at the Oceania Women's Sevens Championship in November, behind World Series core teams Australia, Fiji and New Zealand, however Samoa - who finished fifth in Suva - has been overlooked.
Argentina, Colombia and Mexico will represent the Americas in the new competition. Belgium, Poland and Scotland will fly the flag for Europe and the UK, with China, Japan and Kazakhstan taking part from Asia and Kenya joining hosts South Africa.
China and Kenya have already qualified for Tokyo 2020, while Argentina, Colombia, Kazakhstan, Mexico and Papua New Guinea will all take part in the Olympic repechage in June 2020 to try and secure their place at the 2020 Olympic Games.
The 12 teams will be drawn into three pools of four, with the overall winner to gain core team status on the next Women's World Sevens Series, replacing the bottom placed core team at the end of the current campaign.
The first of two tournaments in the men's challenger series, which features 16 teams, kicks off in Viña del Mar, Chile this weekend.