The 2009 film is the highest-grossing movie on record, having netted US$2.8 billion (about RM8.5 billion) at the box office worldwide.
Cameron had originally planned for only two sequels.
"In writing the new films, I've come to realise that 'Avatar's' world, story and characters have become even richer than I anticipated, and it became apparent that two films would not be enough to capture everything I wanted to put on screen," Cameron said in a statement.
The movie featured Sigourney Weaver, Sam Worthington and Zoe Saldana and told the story of a paraplegic soldier sent to the fictitious planet of Pandora, which is coveted for its natural resources.
The three sequels will be filmed simultaneously beginning next year, Fox said in a statement. They will be released in December of 2016, 2017 and 2018, respectively.
Cameron, who wrote "Titanic" and "Avatar" by himself, has taken on four screenwriters for the project. Josh Friedman ("War of the World"), Rick Jaffa and Amanda Silver ("Dawn of the Planet of the Apes") and Shane Salerno ("Armageddon" and "Savages") will work on the sequels.
"We at the studio have no higher priority, and can feel no greater joy, than enabling Jim to continue and expand his vision of the world of 'Avatar'," said Fox Film chief Jim Gianopulos in a statement.
According to trade magazine Variety, the budget for the three films could reach US$1 billion. - AFP, August 2, 2013