The former London model will feature in the track 'Chikni Chameli' in the Dharma Productions remake.
"Katrina Kaif is doing a full on item song in Agneepath... It's a total swinging number called 'Chikni Chameli'... we shoot it in a week!!" Johar posted on Twitter.
Kaif's item song 'Sheila Ki Jawani' from Tees Maar Khan is widely-regarded as one of the most popular item tracks in Hindi cinema.
Speaking about working with director Farah Khan on the song, the actor told Digital Spy last year: "All her movies have that one really special song for the girls and I didn't want to let anyone down.
"I was very nervous about it and put in those hours to make sure I did the best that I could."
Despite the success of 'Sheila Ki Jawani', Kaif reportedly said that she would not shoot any further item songs.
Johar is said to have hired private security to ensure that scenes from Agneepath are not leaked before the film comes out.
The project is scheduled to release in 2012.
Watch the trailer for Agneepath below: