The Australian actor and comedian, who is best known as the man behind character Dame Edna Everage, has accepted the role of the Goblin King in the upcoming Peter Jackson-directed movie.
Jackson wrote on Facebook: "Barry is perhaps best known for his business and social connections as the long-time manager of Dame Edna Everage. He has also been an ardent supporter of the rather misunderstood and unfairly maligned Australian politician, Sir Les Patterson.
"However, in his spare time, Barry is also a fine actor, and we're looking forward to seeing him invest the Goblin King with the delicate sensitivity and emotional depth this character deserves."
Benedict Cumberbatch was recently confirmed as a voice of dragon Smaug in the Lord of the Rings prequel.
Sir Ian McKellen, Cate Blanchett, Orlando Bloom, Sir Ian Holm, Sir Christopher Lee, Hugo Weaving, Elijah Wood and Andy Serkis will reprise their roles from the Lord of the Rings trilogy, while cast newcomers include Richard Armitage, Stephen Fry, Sylvester McCoy, Bret McKenzie, James Nesbitt, Lee Pace, Aidan Turner and Luke Evans.
The Hobbit movies will be divided into two parts. The first movie, An Unexpected Journey, will be released on December 14, 2012. The second film, There and Back Again, follows on December 13, 2013.