The Russian-born 43-year-old is the third Welsh competitor to be selected for the Games, following triathlete Non Stanford and sailor Hannah Mills.
Allen, who lives in Blackwood, was part of the British skeet team that won gold at the 2014 World Championships.
She also won individual silver in 2014 to go with a bronze claimed at the 2013 event in Peru.
Allen will be competing at her second Olympic Games, having failed to qualify for the skeet final at London 2012 when she admitted the applause of the crowd had put her off.
Previously, Allen was a bronze medallist at the 2006 Commonwealth Games when she competed for England and in 2014 won silver at the Glasgow Games after qualifying for Wales through residency.
"In shooting you have to win your quota place... but you win the quota for the country and I did that at the World Championships in Spain in 2014," Allen told BBC Wales Sport.
"But the [individual] place is never guaranteed, so you have to wait and see and you have to do your best, carry on competing at the best level you can.
"So you can never count your chickens until they're hatched!"
Welsh shooter Elena Allen has been named in the Great Britain team for the 2016 Olympics in Rio.