Taylor, the son of 1987 World Cup winning inside centre Warwick, will slot into the pivotal fly-half role for his first match after Dan Carter, Aaron Cruden and Beauden Barrett had all been ruled out of the match with injury.
The 24-year-old had been brought into the side along with 10-test All Black Colin Slade on Monday following medical checks on Cruden (knee) and Barrett (calf) after the 47-29 victory over the Wallabies in Sydney last week.
"He is mentally tough and plays the game with a lot of confidence and maturity," All Blacks coach Steve Hansen said of his decision to give Taylor the start.
"These factors, along with his assured goalkicking under pressure, has made this an easy selection.
"We have every faith that he will handle the occasion."
The Canterbury Crusaders utility, who can also play inside centre and fullback, was brought into the All Blacks squad on their end of season tour in Europe last year as a late injury replacement, being summoned from a holiday in Thailand.
Slade was the All Blacks' backup to Carter at the 2011 World Cup but suffered a groin strain in the quarter-final against Argentina and has not featured in the national side since.
The All Blacks have held the Bledisloe Cup, the symbol of trans-Tasman supremacy since 2003 and a victory at Wellington Regional Stadium would ensure it remains in New Zealand for another year before the third match in Dunedin on October 19.
Taylor was the only enforced change to the backs from the match in Sydney, while lock Brodie Retallick moves from the bench to replace the injured Luke Romano in a forward pack that includes prop Tony Woodcock, who will earn his 100th cap.
The 32-year-old Woodcock will become the fourth New Zealander to reach the milestone for the All Blacks after current captain Richie McCaw (117), hooker Keven Mealamu (105)and retired fullback Mils Muliaina (100).
"He is a hugely respected player within the group who always puts the team first," Hansen said of Woodcock's milestone.
"It has been business as usual for him and the team this week, but we will enjoy acknowledging his achievement with him after the game."
The majority of changes to the team are on the bench with hooker Dane Coles returning to the matchday 23 after playing for Wellington last week, while Wyatt Crockett has recovered from a knee injury that kept him out of the first test and replaces Ben Franks.
Jeremy Thrush has moved into the bench for Retallick, while Slade is on the bench to cover flyhalf.
Charles Piutau has also recovered from an ankle injury and replaces Ryan Crotty, who made his debut off the bench last week, as cover for the centres.
New Zealand: 15-Israel Dagg, 14-Ben Smith, 13-Conrad Smith, 12-Ma'a Nonu, 11-Julian Savea, 10-Tom Taylor, 9-Aaron Smith, 8-Kieran Read, 7-Richie McCaw (captain), 6-Steven Luatua, 5-Sam Whitelock, 4-Brodie Retallick, 3-Owen Franks, 2-Andrew Hore, 1-Tony Woodcock
Replacements: 16-Dane Coles, 17-Wyatt Crockett, 18-Charlie Faumuina, 19-Jeremy Thrush, 20-Sam Cane, 21-Tawera Kerr-Barlow, 22-Colin Slade, 23-Charles Piutau.