Favreau, 51, whose directorial credits also includes "Iron Man" and "Iron Man 2", will also executive produce the series which will be launched on Disney's streaming platform.
"If you told me at 11 years old that I would be getting to tell stories in the Star Wars universe, I wouldn't have believed you. I can't wait to embark upon this exciting adventure," Favreau said in a statement.
Favreau is not a stranger to the "Star Wars" universe, having played roles in both the "Star Wars: The Clone Wars" animated series and in the upcoming "Solo: A Star Wars Story".
"Jon brings the perfect mix of producing and writing talent, combined with a fluency in the Star Wars universe. This series will allow Jon the chance to work with a diverse group of writers and directors and give Lucasfilm the opportunity to build a robust talent base," she added.
The untitled "Star Wars" live-action series does not yet have a release date.