The movie, starring Philip Seymour Hoffman, Joaquin Phoenix and Amy Adams, will premiere Sept. 1.Read more: Venice Film Festival unveils lineup
Anderson, the director of "Magnolia" and "There Will Be Blood," is the 12th director in the competition who is screening a film for the first time in Venice.
The festival announced the remaining 17 competing films last month, including another four by American directors, including Brian De Palma and Terrence Malick.
By recent tradition, the title of the final "secret film" was delayed.
The 69th Biennale opens Aug. 29 with Mira Nair's "The Reluctant Fundamentalist," which shows out of competition.
There will be several U.S. films appearing outside the competition, too, including Jonathan Demme's "Enzo Avitabile Music Life," Spike Lee's "Bad 25," a documentary about Michael Jackson, and a new film by Robert Redford called "The Company You Keep."
Check out a trailer for "The Master":