The 76-year-old spent his entire career with the Whites, playing 459 times for the club between 1956 and 1969.
A right-back, Cohen won 37 caps for England and featured in every game as the Three Lions won the 1966 World Cup.
Cohen, who is a club ambassador for Fulham, was awarded an MBE in the New Year's Honours in 2000.
A supporter-led group proposed the statue to the Championship club earlier this year and fans will be able to contribute to the cost of the work, which will be carried out by sculptor Douglas Jennings.
"We're delighted that this honour is being paid to George, a true gentleman who has given so much to the supporters of Fulham, England and the world of football," Bob Howes, who was chairman of the fan campaign group, told the club website.
Fulham already have a statue of former Fulham and England inside forward Johnny Haynes outside Craven Cottage, which was unveiled in 2008.
A statue of pop singer Michael Jackson was erected outside the ground in 2011 by previous owner Mohamed Al Fayed, but was removed in 2013 and is now in the National Football Museum in Manchester.
Fulham's American chairman Shahid Khan will match all contributions for Cohen's statue.
"It's only appropriate that George be celebrated and honoured here at Craven Cottage by the club," Khan said.
Fulham have commissioned a statue of George Cohen, part of England's World Cup-winning side in 1966, which will be unveiled at Craven Cottage in October.