Producer Harvey Weinstein confirmed at the Cannes Film Festival that The Matrix star Laurence Fishburne would star in, direct and produce the film.
The Weinstein Company will also co-produce the adaptation.
Coelho's 1988 novel tells of a Spanish shepherd boy who travels to Africa in search of his dream and meets the alchemist along the way.
"This is a special project that now has a special team behind it to ensure that its path to the big screen is handled with the proper care it deserves," Fishburne said.
A search across Spain and Latin America will be made for actors to play the shepherd Santiago and his love interest in the $60m (£30m) project.
Filming will start in about a year in various locations in Europe, as well as the Middle East, including Jordan, Abu Dhabi and northern Africa.
The Alchemist has sold more than 30 million copies worldwide, becoming a best-seller in 18 countries.