The film also stars Belfast-born actor Ciarán Hinds
The Land of Saints and Sinners is to begin in March, 2022.
The action adventure tells the story of a retired assassin who is forced into a game of cat and mouse with three terrorists.
The fishing port of Killybegs and its surrounding areas are to be the location for two months of filming.
The film also stars well-known Belfast-born actor Ciarán Hinds.
Hinds, 68, is a veteran actor and most recently starred in RTÉ's crime drama
Kin as gang boss Eamon Cunningham.
Neeson and Hinds, who are lifelong friends, starred opposite each other in a number of films including John Boorman's
The film is set to be directed by Robert Lorenz who worked with Neeson on the recent box-office hit
A number of locals in Co Donegal are expected to be hired as extras for the filming.
New York-based Neeson, 69, said he jumps at any chance he gets to get home to Ireland.
However, he appeared on the
Late Late Show recently and spoke about not being able to get home to Ballymena to attend his mother's funeral because of travel restrictions during the pandemic.
He told presenter Ryan Tubridy "She passed away, she was 94, she had a good innings
“She passed away last June, which was kinda weird, as it was in the middle of a pandemic, and it was strange for me and my sons in Upstate New York to be watching this funeral ceremony on a screen. Very bizarre.
"I still haven't got my head around it. I think about her every day."