Jones will appear in the Nick Hurran-helmed, second episode of the upcoming three-part season.
"I'm excited and intrigued by the character I shall be playing in Sherlock," the actor said in a statement Monday.
"Delighted to have Toby Jones on board, bringing to life one of Doyle's finest villains," added co-creator, writer and executive producer Steven Moffat.
"We're thrilled to welcome one of our finest actors to the Sherlock family. I know Toby will embrace the part with true relish!" remarked co-creator, writer and executive producer Mark Gatiss.
Jones, 49, is known for his work in the films Infamous, The Mist and Frost/Nixon, as well as in TV's The Girl and Wayward Pines.
"Promising laughter, tears, shocks, surprises and extraordinary cases, it was announced last month that Season 4 will begin with the nation's favorite detective, the mercurial Sherlock Holmes, back once more on British soil, as Doctor Watson and his wife, Mary, prepare for their biggest ever challenge -- becoming parents for the first time," said a synopsis for Season 4 of Sherlock, which will once again air on the BBC in the United Kingdom and via PBS' Masterpiece banner in the United States.