Movies
The director had earlier criticised studio Marvel for setting an "unrealistic" release date for the superhero sequel. Rumours later surfaced that he would not return to direct the film.
Favreau has now reportedly agreed a contract after being offered a more lucrative deal by Marvel boss David Maisel.
Robert Downey Jr. will also return for Iron Man 2, which is scheduled for an April 2010 release.
> Click here for our review of Iron Man
Movie Reviews
'The Vow' reviewChanning Tatum tries to win back Rachel McAdams in romantic drama The Vow.
At the Movies
This Week's 5 Hottest Movie VideosTrailers for The Avengers and Spider-Man are among this week's highlights in film.
Movies Interviews
Daniel Radcliffe talks 'Woman in Black'The actor talks to Digital Spy about his first post-Potter outing.
Box Office Charts
'Chronicle' leads UK box officeSuperhero drama Chronicle leads the UK box office ahead of Journey 2.
