The move is another step towards profitability by the Google-owned video sharing site, as it struggles to attract advertisers, many who do not want to be associated with some of the content uploaded by the public.
Few financial details of the deal have been released, but the two will share advertising revenue and YouTube will integrate Time Warner's video player as part of the deal.
The deal expands an existing agreement Time Warner has with YouTube that has put promotional clips from HBO and CNN International on the site.
Added to that will be clips from The CW network, which is home to 'America's Next Top Model', 'Gossip Girl', '90210' and 'Smallville'.
It also includes clips from Warner Brothers films, Adult Swim and TNT. Clips from Warner Bros hit 'The Ellen DeGeneres Show' will also feature.
The addition of so much Time Warner content will allow YouTube to compete more fully with Hulu, which is owned by News Corporation, NBC Universal and Walt Disney.
Hulu has a wealth of content from big US shows including the likes of 'Lost', '30 Rock', 'House', 'The Simpsons', and 'Hell's Kitchen'.
Jordan Hoffner head of partnerships at YouTube, said: "It's really important to get them on the platform and then it opens up new opportunities. The content that's produced by Time Warner lends itself to short form like the news clips from CNN or the cartoon shorts from Cartoon Network."
The partnership with Time Warner adds to existing ones YouTube has with Disney, which gives it ABC and ESPN clips.
Jeffrey Bewkes, Time Warner's CEO, said: "Working with YouTube, we expect to improve our ability to monetize this short-form content through new and creative advertising initiatives."
While YouTube is not making a profit a report in the Wall Street Journal said that some Wall Street analysts estimate YouTube's revenue will double to about $500m this year.