The 16 contestants, whose identities will be revealed during tonight's show, will record a 60-second advert featuring their version of 'When You Wish Upon A Star' as the soundtrack.
The deal, negotiated by Fremantle and Simon Cowell's Syco earlier this year, is said to be worth several million pounds to The X Factor and follows the retailer's announcement last month that it will be the show's official fashion partner.
"The finalists have never had a commercial partnership outside of the show before and it's certainly the first time M&S have done anything like this," a source told the The Mail On Sunday. "We always have a big standalone Christmas campaign that becomes a talking point for our customers.
"But this year rather than using celebrities, the campaign will feature The X Factor contestants and their God-given talents. They will record an exclusive version of 'When You Wish Upon A Star' which will be recorded especially for the advert."
An X Factor source added that the singers will receive a "one-off nominal fee" for the work since it isn't part of the show.
The advert, which will showcase Marks & Spencer's Christmas clothing collection, is expected to debut later this year during the commercial break of The X Factor.
Former judge Dannii Minogue has previously modelled for Marks & Spencer.
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