The rights for Red Leaves (a short story) and Light In August (a novel) were acquired from the Faulkner Estate, Franco told ScreenDaily.
The estate will act as executive producers. Franco's producing partner from his recent directorial foray Good Time Max, Vince Jolivette, will produce.
Good Time Max was presented at Tribeca earlier this year, and is part of the Beyond Mediterranean non-competitive line-up at Taormina Film Festival where Franco was on hand to present the film.
'Red Leaves will be a short film, which is more complicated than a feature in some ways but it gives me a chance to get used to shooting a period piece,' said Franco.
Both stories are set in the 17th century in the American Deep South. Red Leaves follows the story of a doomed black slave of an Indian chief.
Shooting for Red Leaves will get underway this year, Franco said, while Light In August has no projected shooting date.
The Faulkner Estate, which has a history of distributing short films, won the best short film Oscar in 2004 for the Faulkner-written Two Soldiers.
Franco said the distribution method is up in the air at the moment but that Leaves will possibly in a long enough format for television.
Following his third installment of Spiderman, and the recent comedy Pineapple Express (directed by David Gorden Green) Franco - who abandoned his English literature studies at UCLA to pursue his acting career - has a strong interest in literary works.