Anne Fletcher ("The Proposal") was previously rumored to take the director's chair, but Shankman is now in negotiations to helm the project, said The Hollywood Reporter.
The follow-up to 2007 film, the second movie titled "Disenchanted," has been in development since 2010.
No release date has been announced by Disney yet, but the studio is planning to start the production in summer 2017.
Amy Adams is expected to return as Princess Giselle.
It's unclear if any other original cast like Patrick Dempsey, James Marsden, Idina Menzel and Susan Sarandon will reprise their roles as well.
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