However, the Fox show has also announced that Khloe Kardashian will not be back for season three.
It had been widely rumoured that the Keeping Up with the Kardashians star would not be returning to the role after her performance last year was met with criticism.
Simon Cowell revealed in a statement that he is "thrilled" Lopez will be returning for the show's third run.
"Hosting a live show and keeping the judges - especially Demi [Lovato] - in line, is not an easy job, but Mario is a pro and we are glad he's coming back," he said.
The show's producers went on to comment: "Khloe Kardashian will not be returning to co-host The X Factor. We really enjoyed working with her and wish her all the best in her future endeavors."
It is not known if Cowell will look to recruit a new co-host for Lopez or if he will continue as the show's only presenter.
Lopez tweeted his excitement about his return to the show, saying: "I'm excited to officially announce I'm returning to the @TheXFactorUSA team! We're coming back stronger & better than ever... Can't wait."
There are currently two vacant spots on the judging panel following Britney Spears and LA Reid's departures at the end of last season. Demi Lovato has been confirmed to return for a second season.
Many stars have been tipped to fill the spots, including Katy Perry, Ne-Yo and most recently Kelly Rowland.