The 2012 event will be Price’s first full-size show garden at Chelsea and is a step up from smaller garden designs, for which she won silver medals in 2007 and 2008.
Price is also co-designer of the 2012 gardens at the Olympic Park in east London and remains at the core of the team planning the post-Games legacy design.
Her Chelsea design will evoke romantic British landscapes through sawing rushes and grasses and delicate meadow flowers around pools sculpted from Chilmark limestone.
Copper detailing refers to mineral-rich upland streams and rills of north Wales and Dartmoor. There will be a stepping-stone walkway and glade of multi-stemmed birch.
Bog and marginal plants include flag iris, Iris pseudacorus, meadow sweet, Filipendula ulmaria and the sensitive fern, Onoclea sensibilis.
Previous accolades for Price include a gold medal in the conceptual-show-garden category at the RHS Hampton Court Flower Show in 2006.
For the last three consecutive years the Telegraph’s garden has won best show garden by RHS judges.
Daily Telegraph gardening editor Joanna Fortnam said: "Sarah Price is one of Britain’s most exciting and sought-after young garden designers.
"We’ve watched her emerge from promising art student to first-rate garden designer with major projects including a key role in designing this year’s Olympic gardens."