The service is scheduled to be available to Google AdWords' customers in the fourth quarter, Google and XM Satellite Radio said.
"By providing access to XM's premier satellite audience, Google advertisers will have an easy way to target, schedule, deliver and measure satellite radio campaigns," said Ryan Steelberg, Google's head of radio operations, in a statement.
The deal gives XM Satellite Radio access to Google's advertisers " both large and small " via targeted channels. Google's advertisers will benefit from what the companies describe as a "simple, automated way to reach millions of XM listeners.
"XM is excited about the opportunity to leverage Google's extensive advertising base to open up a new revenue stream," said D. Scott Karnedy, senior vice president at XM Satellite Radio, in a statement.