The deal will allow the U.S. firm to retain a presence in the UK and Ireland having closed its shops in those markets earlier this year.
Shares in Next were up 1% at 0842 GMT.
Under the plan the two groups will form a joint venture to operate Gap’s e-commerce business across the NEXT Total Platform, host Gap-branded Shop-in-Shops and offer click-and-collect options for online customers beginning in 2022.
Next will own 51% of the JV while Gap will own 49%.
Gap will be able to benefit from Next’s UK and Ireland store network of around 500 stores.
Next also has an online presence in over 70 countries selling its own brand and over 700 other fashion, home and beauty brands.
“Gap is partnering with Next … to amplify our omnichannel business and meet our customers in (the) UK & Ireland where they are shopping now,” said Mark Breitbard, CEO and President of Gap Global.
The partnership echoes moves by online retailers ASOS (LON:ASOS) and Boohoo to snap up fashion brands that have gone out of business in the UK and are no longer available on the high street.