It is the first time the band members have worked collectively since their split more than 30 years ago.
The quartet - Agnetha Faltskog, Bjorn Ulvaeus, Benny Andersson, and Anni-Frid Lyngstad - will work on the new project with music mogul Simon Fuller.
The group has announced they will work with Fuller, who rose to fame managing the Spice Girls, on what is being described as a “groundbreaking venture that will utilise the very latest in digital and virtual reality technology”.
Lyngstad said fans around the world always ask about a reunion, and added: “So I hope this new Abba creation will excite them as much as it excites me”.
Andersson added: “We’re inspired by the limitless possibilities of what the future holds and are loving being a part of creating something new and dramatic here. A time machine that captures the essence of who we were. And are.”
The full details of the new project have not been announced but an official release says the foursome will be involved in the creative process with a view to “maintaining the authenticity and integrity of the band’s original vision”.
The project says it will will aim to take the Abba experience to a new generation of fans and will enable them to see, hear and feel the band “in a way previously unimagined”.
Fuller said: “The creativity and ideas flowing from the members of Abba over the past few months have filled me with great excitement.
“We are exploring a new technological world, with virtual reality and artificial intelligence at the forefront, that will allow us to create new forms of entertainment and content we couldn’t have previously imagined.”
In June this year the band performed together for the first time in 30 years to celebrate their 50th anniversary. They were inducted into the Rock and Roll Hall of Fame in 2010, but did not perform to mark the occasion.
Their hits over the years include Waterloo, Dancing Queen, Mamma Mia and The Winner Takes It All.
Their music was adapted into the successful theatre show, Mamma Mia! which was also turned into a 2008 film featuring Meryl Streep, Julie Walters, Pierce Brosnan, Colin Firth and Christine Baranski.
The full details of their new project will be announced in 2017.