Rachel will make her on-screen appearance in April as the real Lisa Loveday, Louis and Simone's long-lost daughter.
Fans of the soap have been introduced to Sonia Albright, an impostor pretending to be Lisa, but the real Lisa will enter the village next month.
Rachel, who has already begun filming on set in Liverpool, said: "I am so excited to have joined Hollyoaks and be part of the Loveday family who are brilliant actors and already feel like an extension of my own family.
"It is quite a pressure to be coming in as the real Lisa Loveday as she is such an anticipated arrival in Hollyoaks village."
She continued: "I think it's fair to say that the audience have hoped that we would at some point get to meet the real Lisa and although I can't say too much, the fallout is big and far-reaching. What has happened to Lisa so far in her life has turned her into a tough cookie and it has been great to bring that to life on screen."
Rachel first rose to fame while starring on the fifth series of The X Factor in 2008 where she finished in ninth place.
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