UFC officials announced the matchup on Monday.
Johnson is coming off a controversial split decision loss to Beneil Dariush earlier this month at UFC Fight Night 73. Prior to that, he picked up an upset decision win over Edson Barboza.
Diaz is coming off a dominant decision loss to now-champion Rafael dos Anjos at UFC on FOX 13. Before that, he stopped Gray Maynard in late 2013.
The card placement for the bout is unknown at this time.
UFC on FOX 17 takes place live from the Amway Center in Orlando, FL on Dec. 19.