The former Lost star, who gave birth to her first child with boyfriend Norman Kali last month, will play an elf called Tauriel in Peter Jackson's adaptation of the JRR Tolkien novel.
Jackson wrote on his official Facebook page: "Evangeline Lilly will be playing a new character - the Woodland Elf, Tauriel. Her name means 'daughter of Mirkwood' and, beyond that, we must leave you guessing! (No, there is no romantic connection to Legolas.)
"What is not a secret is how talented and compelling an actress Evangeline is; we are thrilled and excited she will be the one to bring our first true Sylvan Elf to life."
Jackson also confirmed that the first block of shooting has now finished and that location scouting for the second production block is underway.
He added: "Evangeline and Barry [Humphries], along with Welsh actor Luke Evans as Bard and Benedict Cumberbatch as Smaug, just about rounds out the major casting. I cannot wait to get stuck into these new scenes!"
Lilly's former partner Dominic Monaghan made his movie breakthrough in Jackson's Lord of the Rings trilogy playing hobbit Merry Brandybuck.
The Hobbit will be divided into two parts.
The Hobbit: An Unexpected Journey will be released on December 14, 2012 and will be followed by The Hobbit: There and Back Again on December 13, 2013.