Although previously rumored and mentioned as a possibility by Jessica Lange herself, it has been officially announced that she's back for American Horror Story Season 2. Co-Creator Ryan Murphy also revealed that her new character will have a more prominent role this season:
“We have designed the second season of American Horror Story completely around her character... Last year Jessica came in with Connie Britton and Dylan McDermott. This will really be the Jessica Lange show so I’m very excited about it. We are designing this amazing new opposite of the Constance character for her. She and I have spoken about different things. She has a lot of ideas, and has a lot of input into her character. She told me some things she has always wanted to play as an actress. She’s a great collaborator and a great friend. I really sweated this negotiation... so I’m glad she is firmly on board.”
For those who missed the earlier news, the Harmon's story is over and Season 2 will feature a brand new theme, location, and cast. At this point, all we know about the story is that it is supposed to take place on the East Coast in a "horror institution". Some of the Season 1 actors will return, but will play completely new characters.
Another new bit of news is that Ryan Murphy has confirmed that 3 additional actors from Season 1 will return. Thankfully, we won't have to wait long for more details on the cast and story of American Horror Story Season 2. The cast is expected to be officially announced tomorrow at PaleyFest in Beverly Hills.