The 62-year-old star is said to have started work on her first album in over eight years, The Daily Telegraph says.
She is collaborating with songwriter Jorgen Elofsson on the LP, who has previously worked with Celine Dion, Britney Spears and Westlife among others.
Her spokesman Staffan Linde confirmed the comeback, but did not state when the album will be released.
Following ABBA's split in the early 1980s, Faltskog went into a musical hiatus for many years after an initial attempt at a solo career.
Her last album My Colouring Book was released in 2004.
Earlier this week, it was announced that an ABBA museum will open in Stockholm next year.
Watch a video for 'Touch Me When I'm Dreaming' by Agnetha Faltskog below: