The game will take place on June 20 next year and will mark the first time Cardiff has hosted the event in the era of 'destination finals', which were introduced in 2015.
Last year's showpiece final was staged at Celtic Park in Glasgow.
Former British and Irish Lions captain Sam Warburton has backed his hometown to deliver.
"Rugby has always been a sport at the heart of Wales and having another world-class rugby event in our capital city is very exciting," Warburton told pro14rugby.org.
"I've seen a couple of matches in Cardiff City Stadium and the atmosphere can be electric with the right crowd - it's going to be a great final whichever of the teams make it."
The PRO14 league season begins on September 27.
Martin Anayi, PRO14 Rugby CEO, said: "We have long heard the voices of the Welsh fans who wanted to see the Guinness PRO14 Final take place here and it's great that all of the pieces have finally fallen into place for 2020."