Lt. Gen. Paradon Phatthanatabutr, the head of Thailand's National Security Council, told CNN he and Hassan Taib, the leader of separatist group Barisan Revolusi Nasional, agreed on a process for the peace talks.
Paradon said the talks will take place in Malaysia and may begin within two weeks.
Muslim and academic representatives in Thailand agreed the news is a historic breakthrough, but said much more needs to be done and the violence will not end immediately, the Bangkok Post reported.
The southern provinces of the country have been battered with violence from insurgents who have fought for a separate Islamic state for years, CNN reported.
The Thai government has sent more than 150,000 soldiers to the region, but analysts said the military has struggled to deal with the insurgents' tactics, CNN said.