The heavyweight matchup will headline UFC Fight Night on Feb. 17 in Phoenix. It will mark the first UFC main card to air exclusively on ESPN television. A UFC Fight Night main card on Jan. 19 airs on ESPN+.
ESPN first reported the potential bout earlier this month, and White confirmed the pairing Friday.
Velasquez has also signed a new four-fight contract with the UFC, sources told ESPN's Ariel Helwani.
Velasquez (14-2), 36, has not fought since July 2016 because of injuries. He was last scheduled to fight Fabricio Werdum in December 2016 but was pulled at the last minute by the Nevada State Athletic Commission because of concerns with his back. He underwent surgery in 2017.
Fighting out of American Kickboxing Academy in San Jose, California,Velasquez is considered one of the greatest heavyweights of all time. He has struggled to remain active, however, limited to two appearances since 2014, including a submission loss to Werdum in a 2015 title fight.
Ngannou (12-3) is coming off a huge 45-second knockout against Curtis Blaydes on Nov. 24. That result snapped a two-fight skid for Ngannou, which included a bizarre, lackluster performance against Derrick Lewis in July.
A native of Cameroon, Ngannou catapulted into title contention in early 2018 on the heels of six consecutive UFC wins. ESPN currently ranks Ngannou the No. 4 heavyweight in the world.