The German, now 40 years old, retired from Formula One at the end of 2006. All being well, he will make his comeback in Valencia, Spain, next month.
"Ferrari intends to entrust Michael Schumacher with Felipe Massa's car for as long as the Brazilian driver is not able to race," the Italian team said in a statement.
"Michael Schumacher has shown his willingness and in the next few days he will undergo a specific programme of preparation at the end of which it will be possible to confirm his participation in the championship starting with the European Grand Prix on Aug 23."
That race is one of the few Schumacher is unfamiliar with since the Spanish street circuit was added to the calendar only last season.
Schumacher's comeback for the reigning championswill be a huge boost for Formula One organisers as well as local fans, who could be without home hero Fernando Alonso after his Renault team was suspended for one race.
His comeback will be the first time McLaren's current world champion Lewis Hamilton, as well as Red Bull's title contender Sebastian Vettel, have raced against the man who dominated a decade.
Both Hamilton, 24, and 22-year-old German race winner Vettel -- nicknamed 'Baby Schumi' by his compatriots -- entered the sport after Schumacher had left the scene.
Ferrari contacted the German, who has taken part in occasional motorcycle races since he retired, after Brazilian Massa fractured his skull in an accident at last weekend's Hungarian Grand Prix.
"I talked on the telephone with (team principal) Stefano Domenicali and (Ferrari president) Luca de Montezemolo this afternoon and we decided jointly that I'll start preparing to jump in for Felipe," he said on his website.
"Even though I completely wrapped up the subject of Formula One quite a while ago, due to my attachment to the team I cannot ignore this unfortunate situation. As a competitor, like I am, I'm looking forward to this challenge."
Schumacher is Formula One's most successful driver, with 91 wins and more titles and records than anyone else has ever achieved. He won his first world title aged 25 with Benetton in 1994, by a single point from Britain's Damon Hill, and retained the title the following season before moving to Ferrari in 1996. He won five straight titles from 2000, and his final tally of race wins far eclipsed the previous mark of 51 set by Frenchman Alain Prost.
Schumacher's return had looked doubtful earlier in the week when his manager Willi Weber was widely quoted as saying it was impossible. The retired champion was also said to be still recovering from a neck injury when he crashed his motorbike during tests in Spain in mid-February.
Reuters
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