Partnership could see the two work together on a new electric hypercar, and electrified drivetrains for other more affordable models.
In a statement released overnight Lotus and Williams confirmed a technical partnership where they will "share research and development into advanced propulsion technologies".
Official details about the full extent of the partnership are thin on the ground, but it should be noted, Williams has experience in battery technology and electric drivetrains through its involvement in Formula E.
According to Autocar, Williams will lead development of Omega's drivetrain, while Lotus will engineer the rest of the vehicle.
It's understood the hypercar will be built in limited numbers, and have a starting price of around £2 million ($3.6 million).
With emissions regulations tightening in many major markets, automakers have been looking to mild hybrids, hybrids, plug-in hybrids and full-electric vehicles to stay compliant.
Road & Track asked Lotus if this partnership meant all future models will be electrified.
A spokesperson stated the partnership isn't restricted to just battery and electric motor technology, and as such "it doesn’t mean that all future Lotuses will be electrified, because we are looking at all manner of propulsion systems, including ICE (internal combustion engines)".