Director Peter Jackson is turning his highly-anticipated The Hobbit movies into a trilogy.

The Lord of the Rings filmmaker wrapped an epic 266-day shoot in New Zealand in early July and the footage will be split into two blockbusters, titled The Hobbit: An Unexpected Journey and The Hobbit: There And Back Again.

However, rumors recently surfaced online suggesting Jackson had been approached by Warner Bros. studio bosses to expand the franchise and now both Ian McKellen, who plays wizard Gandalf in the film series, and Jackson have confirmed the news.

In a Twitter.com post on Monday, McKellen simply wrote, "Two HOBBIT films will become THREE."

Moments later, Jackson took to his Facebook.com page to explain the decision he made with his screenwriting partners Fran Walsh and Philippa Boyens in detail.

The message to fans reads in part: "It is only at the end of a shoot that you finally get the chance to sit down and have a look at the film you have made. Recently Fran, Phil and I did just this when we watched for the first time an early cut of the first movie - and a large chunk of the second.

"We were really pleased with the way the story was coming together, in particular, the strength of the characters and the cast who have brought them to life. All of which gave rise to a simple question: do we take this chance to tell more of the tale? And the answer from our perspective as the filmmakers, and as fans, was an unreserved 'yes'...

"So, without further ado... I'd like to announce that two films will become three."

The first installment of The Hobbit trilogy, based on J.R.R. Tolkien's classic novel and starring Martin Freeman as Bilbo Baggins, is set to hit theatres in December.