The 37-year-old Filipino has won world titles in eight weight divisions.
"Yes, the fight is on. I have agreed to a November 5 fight with reigning WBO welterweight champion Jessie Vargas," Pacquiao said in a statement, reports Xinhua news agency.
"Boxing is my passion. I miss what I'd been doing inside the gym and atop the ring," he added.
After winning on a unanimous decision against Timothy Bradley of the US in April, Pacquiao said he would retire to focus on his political career.
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