The director announced Monday he will be filming the sequels in New Zealand, where he shot the triple Academy Award-winning original. In an interview with The Associated Press, Cameron also talked about life on a New Zealand farm, where he's growing walnuts and allowing his children to roam.
Cameron, 59, said he plans to release the first sequel in 2016, seven years after the release of "Avatar," which has become the highest-grossing film in history with a box office take of nearly $2.8 billion.
He said a core team has been developing new software for the sequels even while he's been gone on other projects, including 18 months planning a 7-mile descent to the deepest part of the ocean, which he successfully completed last year.
"It's going to be a lot of new imagery and a lot of new environments and creatures across Pandora," he said. "We're blowing it out all over the place. At first I thought I was going to take it onto other worlds as well, in the same solar system, but it turned out not to be necessary. I mean the Pandora that we have imagined will be a fantasy land that is going to occupy people for decades to come, the way I see it."
Cameron said the films will explore different Na'vi cultures as well the cultures of other Pandora creatures.
"There's a fair bit of underwater stuff. It's been inaccurately said that the second film takes place underwater. That's not true," he said. "There are underwater scenes and surface-water scenes having to do with indigenous ocean cultures that are distributed across the three films."
He said water is enormously difficult to recreate on a computer, something he's been talking about with Joe Letteri, the visual effects supervisor at Weta Digital.
"I said Joe, you know, there's a lot of water," Cameron said. "And he basically said 'Bring it on. We're ready.'"
He said the first movie focused on the main character, Jake Sully.
"It was very Jake-centric. His story seen through his eyes," Cameron said. "We spread it around quite a bit more as we go forward. It's really the story of his family, the family that he creates on Pandora. His extended family. So think of it as a family saga like 'The Godfather.'"
Cameron said the theme of sustainability that runs through the "Avatar" series also extends to his personal life. He and fifth wife Suzy Amis bought a farm about 90 minutes' drive from Wellington where they spend some of the year with their three children. Cameron said he's putting in 650 walnut trees.
"There'll also be tree crops, grains, produce, it will be quite a mixed bag," he said. "But really, I think of it as an experimental station to look at various sustainable agriculture approaches."
A native of Canada, Cameron said the New Zealand farm feels like "closing a loop" after he spent summers on his grandfather's farm in southern Ontario.
"The kids love it here. They love that combination of freedom and responsibility that you get here because you can run freely," he said. "There are no predators and snakes and that sort of thing. We just let them go out with a walkie-talkie, and as long as they are back by dinner, we don't care where they are."
He said he plans to bring his own helicopter from California to help make the commute from the farm to Wellington when he's working on the movies.
Before then, he said, he'll be throwing a Christmas party for the community around his farm. He said about 95 people turned up last year but he worries that numbers could be down this year because it's going to be an all-vegan menu, a lifestyle his family recently adopted.