John Anthony Downey, 61, from County Donegal in the Republic of Ireland, was arrested at London's Gatwick Airport on Sunday.
He will appear before magistrates in London later today charged with four counts of murder and another charge of intending to cause an explosion likely to endanger life.
Prosecutors said the charges resulted from a fresh investigation of the attack, which was one of the most notorious IRA strikes on the British mainland.
A nail bomb hidden in a car near Hyde Park exploded as members of the Household Cavalry made their way from their barracks to the changing of the guard at Buckingham Palace.
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Less than two hours later a second bomb exploded underneath a bandstand in Regent's Park, killing seven soldiers and injuring dozens of others.
Sue Hemming, head of special crime and counter-terrorism at the Crown Prosecution Service, said: "The Metropolitan Police Service has been investigating the explosion near Hyde Park in London which occurred on 20 July 1982.
"We have reviewed the evidence gathered and authorised them to charge John Anthony Downey, 61, of County Donegal, Ireland.
"It is alleged that Downey is responsible for the improvised explosive device contained in a car parked in South Carriage Drive, SW1, London, which resulted in the deaths of four members of the Royal Household Cavalry, Blues and Royals, as they travelled on their daily route from their barracks to Buckingham Palace."
The paramilitary group which fought against British control of Northern Ireland officially disbanded in 2008, a decade after the Good Friday peace agreement largely ended the three decades of sectarian violence in the province.