It had been rumoured since December last year that Bloom would be a part of the project, despite his character's absence from Tolkien's original novel.
"Ten years ago, Orlando Bloom created an iconic character with his portrayal of Legolas," Jackson wrote on his official Facebook page. "I'm excited to announce today that we'll be revisiting Middle Earth with him once more."
He continued: "I'm thrilled to be working with Orlando again. Funny thing is, I look older and he doesn't! I guess that's why he makes such a wonderful elf."
Bloom rejoins fellow Lord of the Rings stars including Elijah Wood, Cate Blanchett, Hugo Weaving, Andy Serkis and Sir Ian McKellen who have all signed on for the prequel films.
The Hobbit: Part One is expected to arrive in cinemas in December 2012.