Alcon Entertainment is developing the project, which Scott has committed to directing.
No start date has been set for the production, however.
Green penned the film "The Green Lantern" and episodes of the TV shows "Heroes," "The River," "Kings" and "Everwood."
He is in talks with Alcon to re-tool a script by Hampton Fancher, author of the original movie, Variety said.
Variety said the sequel is expected to take place several years after the events of the first film concluded.
No casting has been announced.