Smith, who returned to England's T20 squad earlier this year, has been named alongside fellow spinners Sophie Ecclestone, Sarah Glenn and Charlie Dean in a 15-strong group captained by Heather Knight.
As expected, there are no places for Tammy Beaumont, Issy Wong and Mahika Gaur, while Lauren Filer's omission means England will travel without an express-pace bowler.
England's spin attack is rated among the best in world cricket, and is set to have a major bearing on how they perform at the United Arab Emirates-hosted tournament, which begins on October 3.
Conditions are likely to be spin-friendly at both venues in Dubai and Sharjah after the competition was moved from Bangladesh because of safety and security concerns.
Three players have made an England T20 World Cup squad for the first time - Freya Kemp, Bess Heath and Danielle Gibson.
Heath is set to understudy wicketkeeper Amy Jones, while Kemp's selection alongside Gibson gives England considerable strength in the allrounder department.
England's opening World Cup game is against Bangladesh in Sharjah on October 5, before they face remaining pool opponents South Africa, Scotland and West Indies.
The squad will head to Abu Dhabi for a training camp from September 13-24, before official tournament warm-up games.
England head coach Jon Lewis said: "Selecting teams and squads with this group of players has become incredibly tricky and tough.
"There are players who have been really unfortunate to miss out, and they will be a big part of what we do with England Cricket in the future.
"I feel the 15 players selected give us a really well balanced squad in terms of experience, youth and most importantly the skills to cope and excel in the conditions we feel we will be faced with in the UAE."
Skipper Knight added: "World Cups are always special events to be involved in as a player, and I am really excited by the squad we have selected to take over to the UAE.
"It is an honour to lead the team into another World Cup. We are looking forward to the challenges and opportunities ahead."
Beaumont and Wong have been included in the England squad for three one-day internationals against Ireland in Belfast from September 7-11, while they are joined by Gaur in a T20 group for two games in Dublin on September 14 and 15.
Kate Cross will captain both squads, with Gaur's return coming after a side strain meant she sat out England's home series against New Zealand and The Hundred.
England T20 World Cup squad: Heather Knight (capt), Lauren Bell, Maia Bouchier, Alice Capsey, Charlie Dean, Sophia Dunkley, Sophie Ecclestone, Danielle Gibson, Sarah Glenn, Bess Heath, Amy Jones, Freya Kemp, Nat Sciver-Brunt, Linsey Smith, Danni Wyatt.
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