Lydon told Britain's Guardian newspaper that the influential band he created in 1978, a year after the disintegration of the Sex Pistols, and which lasted for 14 years, would reform with a new line-up.
He said the new-look PiL will not contain original band members Jah Wobble or former Clash guitarist Keith Levene but will feature guitarist Lu Edmonds, drummer Bruce Smith and a new arrival, multi-instrumentalist Scott Firth.
"We'll see where we can go," 53-year-old Lydon told the newspaper. "Some things may be quite similar, some may not."
Lydon reunited with other members of the Sex Pistols last year for a series of gigs to mark the 30th anniversary of the band's seminal album "Never Mind The Bollocks."
But Lydon, who became a figurehead of the short-lived punk revolution in England in 1970s with his anti-establishment stance and attacks on Britain's class system and the monarchy, appears to have mellowed in recent years.
He starred in British reality TV show "I'm A Celebrity Get Me Out Of Here" in 2004, has hosted a few animal documentaries, and also starred in an advertisement for butter wearing a tweed-suit.
He also has no tolerance for noisy, opinionated youngsters any more, it seems.
"Younger people at the moment are very mouthy and aggressive," Lydon told the Guardian.
(Writing by Belinda Goldsmith, Editing by Miral Fahmy)
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