Mr Manafort paid over €2m ($2.5m; £1.8m) to the ex-politicians, including a former European chancellor, it says.
He maintains his innocence.
Mr Trump's ex-deputy campaign manager, Rick Gates, has admitted conspiracy and lying to investigators in a plea deal.
Mr Mueller is investigating claims of Russian political meddling in the US.
There are no allegations that either man colluded with Russia to influence the outcome of the 2016 presidential election, which is the main thrust of the justice department investigation.
What are the latest allegations against Mr Manafort?
Mr Manafort faces new charges of conspiracy, money-laundering, failing to register as an agent for a foreign actor and making false statements.
His alleged payments to former senior European politicians were made in 2012 and 2013, the new indictment says.
He is also alleged to have created a body called the Hapsburg Group to give the former politicians' lobbying efforts the appearance of independent analysis.
The alleged paid lobbying was part of Mr Manafort's work for the Ukrainian government, a pro-Russian party, the Party of Regions, and its leader Viktor Yanukovych, who was president between 2010 and 2014, the indictment says.
Mr Manafort's work is said to have continued after Mr Yanukovych was overthrown and fled to Russia in 2014 following anti-government protests.
The indictment says Mr Manafort did not register as an agent of a foreign principal for this work as required by law.
He is also alleged to have hidden millions of dollars made from his Ukraine work in offshore accounts.
What do we know about the European politicians?
The indictment says the Hapsburg Group was designed to be "a small group of high-level European highly influencial [sic] champions and politically credible friends who can act informally and without any visible relationship with the Government of Ukraine".
The group was managed by a former European chancellor, named as "Foreign Politician A", in co-ordination with Mr Manafort, according to the indictment.
Foreign Politician A and other ex-politicians from the group lobbied members of Congress "in or about 2013", the document also says.
The word chancellor is used in various government roles in Europe, but is the title for the head of government in Austria and Germany.
There is speculation the former chancellor referred to in the indictment is Alfred Gusenbauer who was Austria's chancellor from 2007-08.
He was listed as an expert with US lobbying firm Mercury, which was revealed in Justice Department filings last year as having been hired by Mr Manafort to lobby on behalf of his Ukrainian interests.
The filings also revealed that Mr Gusenbauer met members of Congress in 2013.
In a statement to the BBC, Mr Gusenbauer denied any involvement in Mr Manafort's work in Ukraine but acknowledged he had talked to EU and US politicians.
"I was never working for Mr Yanukovych and never was involved in the activities of Mr Manafort in Ukraine," he said.
"I always had the point of view that it was important to move Ukraine closer to Europe. It would have been extremely positive - if Ukraine could have agreed. I was talking to EU and US politicians to make that point clear. I stopped this activity when that I had the impression that Ukraine was moving in the wrong direction… towards the direction of [Russia's President] Putin and not to the [EU's] European Association Agreement."
"I met him (Mr Manafort) two times because he wanted to know what I was doing in Europe for Ukraine."
What does Mr Gates say?
The new indictment was filed after Rick Gates pledged to co-operate in "any and all matters" with the Mueller inquiry.
Mr Gates, 45, is named as having worked to hide Ukraine income from the US authorities.
In a court appearance, Mr Gates admitted charges of conspiracy and lying to investigators.
He had previously been indicted on more serious criminal counts, including bank fraud and money laundering.
In a letter to family and friends, Mr Gates said he "had a change of heart" after his initial not-guilty plea, according to ABC News.
He reportedly said he was ready to accept "public humiliation" to avoid inflicting prolonged pain on his children.
"The reality of how long this legal process will likely take, the cost, and the circus-like atmosphere of an anticipated trial are too much," he reportedly wrote. "I will better serve my family moving forward by exiting this process."
Sentencing guidelines for him suggest a prison term of between 57 and 71 months. He could have faced decades in prison under the more serious charges.
How did Mr Manafort respond to the plea deal?
The man who resigned as the Trump campaign chairman in August 2016 after five months amid questions over his business dealings maintains his innocence.
He did not comment immediately on the new indictment brought against himself but did respond to Mr Gates's plea deal, insisting he was innocent.
"I had hoped and expected my business colleague would have had the strength to continue the battle to prove our innocence," he said in a statement.
"For reasons yet to surface he chose to do otherwise. This does not alter my commitment to defend myself against the untrue piled up charges contained in the indictments against me."
Mr Manafort has worked on several Republican presidential campaigns, beginning with Gerald Ford's in 1976.