The thousands of negatives and prints are being taken from Bodleian's Talbot archive and other collections.
It is hoped academics and members of the public will help to identify unknown people and buildings in the photographs.
The website is due to go live later this year.
It will include some of the first photographs of Oxford and material from Fox Talbot's The Pencil of Nature, the first book illustrated with photographs.
Project leader Prof Larry J. Schaaf, from Bodleian Libraries, has spent 40 years researching the Victorian inventor.
Prof Schaaf said putting the material online would "help unlock the enormous artistic, documentary and technical information embodied in these images".
The Bodleian spent two years raising Â£2.1m needed to buy the private collection of letters, diaries and photographs which it acquired in October.
Born in Melbury Abbas, Dorset, in 1800, Fox Talbot established the three primary elements of the photographic process: developing, fixing, and printing using paper coated with silver iodide.
He created the first photographic negative in 1835, taken from a window at his home in Lacock Abbey, Wiltshire.
During his career he created more than 4,500 images - about 25,000 of his original negatives and prints are thought to still exist.
The complete photographic works by Victorian pioneer William Henry Fox Talbot is to be made available online.