Gracey's film will follow John's journey as the five-year-old musical prodigy who won a scholarship to the Royal Academy of Music at the age of 11, the Deadline Hollywood reported.
John, 65, teamed up with lyricist Bernie Taupin as his songwriters to become one of the most successful artists of all time.
"Michael has an innovative, imaginative and compelling vision for the film. We want to create an experience that surprises and moves audiences and knew immediately that he was the perfect director to take them on this journey,"said Rocket CEO Steve Hamilton Shaw.
"Everyone knows and loves Elton John's music, but the true story of his life is so incredible that it can only be described as a fantasy," Gracey said.
"His journey from impossible dreamer to stardom and uncontrollable excess is something only a musical film can capture, and I'm so excited to be the one to tell his story."
The film is yet to find actors to play John from his childhood to now.