Carr led the Wolverines to the 1997 national championship. Brian Griese, the quarterback on the 1997 team and now with ESPN as an analyst, made the announcement Saturday night.
Griese and a number of former players were among the estimated 800 attending a fund-raising dinner for Mott Children's Hospital.
Carr was on the College Football Hall of Fame ballot this year for the first time.
Former Michigan Heisman Trophy winner Desmond Howard was inducted last year.
The 2011 class is to be announced Tuesday.