The move was expected as Kenseth, the 2003 NASCAR Cup champion, said Friday that he didn't consider JGR an option for him in 2018.
Jones is 14th in the NASCAR Cup standings as a rookie at JGR affiliate Furniture Row Racing. He has one top-5 and five top-10s in his 18 starts and sits 52 points out of the current playoff cutoff - held by Kenseth, who is 11th in the standings with eight races left in the regular season.
"Matt has been a tremendous asset to our organization over the past five seasons both on and off the track," team owner Joe Gibbs said in a news release. "He's been a great teammate and a great ambassador for our sponsors. We have a great deal of respect for him and we are working hard to get the 20 team into the playoffs to make a run for the championship. We have a great deal of confidence in his abilities to do just that. "At the same time, it's exciting to have Erik back to run full time with us starting next season. When a number of circumstances made it clear over the past few weeks that a second year for the [Furniture Row Racing] car was probably not viable at this time for Erik, we all agreed that we wanted to keep him in the Toyota racing family and felt it was the right time to make this transition."
Having eight wins (including two this year) in the NASCAR Xfinity Series, the 21-year-old Jones is considered one of the sport's potential stars. He also has seven wins in the NASCAR Camping World Truck Series, where he has seven career wins.
"This is a really exciting time in my career for me to make the move back to Joe Gibbs Racing full time in the Cup Series and continue to have the success I've had with them over the last few years," Jones said.
The 45-year-old Kenseth, who has 38 career Cup victories and won the 2003 series title, said Friday he would like to continue racing. There are several teams - including Hendrick Motorsports and Stewart-Haas Racing - that have not confirmed their lineups for 2018.
"I certainly hope to still be racing," said Kenseth, the oldest full-time driver on the circuit. "I think I've got some wins left in me and hopefully can race for championships."
Jones' departure from Furniture Row Racing leaves that organization considering returning to a one-car operation. It expanded to two cars for 2017 with Jones and sponsor 5-Hr Energy, which cannot change organizations because its contract with Furniture Row Racing, as well as the options that go with it, was grandfathered in as part of the non-compete clauses in Monster Energy's deal to sponsor the NASCAR Cup Series. While 5-Hr Energy certainly could remain at Furniture Row, it could be used to sponsor Martin Truex Jr., who has three wins and is one of the favorites to win the 2017 Cup title.
"We'd love to be able to do that [second team again], but I'm not sure the finances are going to allow it," team owner Barney Visser said Saturday. "We'll see what we're able to put together. There's nothing concrete right now for the second team."
Furniture Row Racing has two charters -- it purchased a charter from Premium Motorpsorts prior to the 2017 season -- so it would have to sell or lease the No. 77 team charter if it doesn't field a car in 2018 or else NASCAR could then revoke it and sell it.
"I will always be grateful for the opportunity given to me by Barney Visser and everyone at Furniture Row Racing this year for my first full year in the Cup Series," Jones said in a statement. "I've learned a lot this year and I've had a great group of guys around me each week to lean on as I figured out my rookie season and how to make my way in the Cup Series. ... We've hit our stride the last few weeks with strong finishes and while it's nice to have my plans for 2018 announced, I'm focused on continuing to improve and get this team a win before the season ends."