The film will be produced by his production company "Red Chillies" in association with Farhan Akhtar and Ritesh Sidhwani's "Excel Entertainment".
Farhan will also direct the film, which will have an all-new star cast and will hit theatres around the country late next year.
The film will take off from the point where the first movie ended - with Don surviving the final attack.
SRK will go on to become a much bigger and powerful don in the sequel. The character will be completely dark and SRK will be at his evil best.
Incidentally, Shah Rukh reached the height of his career with two negative roles at the start of his career in Baazighar and Darr.
Also reprising her role will be Priyanka Chopra, who rumour had it was being dropped by Farhan Akhtar for Sushmitha Sen.
However, the rumours aren't true, and Priyanka is supposed to have a meaty part in the new flick.
SRK and Priyanka's dates for the shoot have also been finalized. The sequel is supposed to raise new standards of special effects.