The teenager, who cannot be named for legal reasons, will appear before the town's magistrates tomorrow.
Police say they have also arrested the second of two men wanted for questioning in connection with the incident which happened last Tuesday in Blackburn.
Dean Qayum, 20, was detained this morning, 24 hours after 18-year-old Kaylib Connolly was arrested. Photos of both men had been published by Lancashire Police over the weekend.
Miss Alison McBlaine died in hospital on Thursday following a serious collision around 7.45pm on Tuesday (19th November) on King St/ Whalley Banks at the junction with Pearson Street.
Police believe a car, a Fiat Punto Grande, deliberately mounted the pavement before colliding with Alison, and a second pedestrian, a man aged 26 from Blackburn. He sustained serious injuries and is in hospital.
The car failed to stop at the scene of the collision and was later found on Lower Hollin Bank Street with significant front end damage. Attempts had been made to set the vehicle on fire.
Three people were initially arrested by police on suspicion of murder.
Officers say that in addition to Quaym and Connolly a 26-year-old man remains in custody. A 25-year-old man arrested last week was bailed pending further enquiries until the 19th December to return to the police station.
And the 16 year old youth, from Blackburn, has now been charged with murder. He has been remanded in custody and will appear in court in the morning.
DCI Lee Wilson, of the Force Major Incident Team, said: “My thoughts and those of the team engaged on this inquiry remain with Alison’s loved ones. Her family are being supported by trained officers at this difficult time.”
“I would like to extend my sincere thanks to members of the public who have supported and responded to police appeals for help over the last few days.
"Nevertheless the investigation is at an early stage so if you have any information at all that might help and haven’t already spoken to us, we would like to hear from you as soon as possible.”
Anyone with information should contact police on 101 quoting log 0915 of November 20th or through the Major Incident Portal at https://mipp.police.uk/operation/0401020119E09-PO1
You can also contact independent charity Crimestoppers on 0800 555 111 anonymously.