The 32-year-old was left out of Eddie Jones’ 31-man squad for next month’s tournament in Japan after an altercation with team-mate Mike Brown at a training camp in Treviso.
It was the second breach of discipline in recent months, having been forced to apologise to his team-mates following a late-night drinking session with Billy Vunipola at the end of the Six Nations.
Jones did not rule out the possibility of turning to Te’o in the event of injuries to his current party, but the former Worcester Warriors player has now signed for Toulon as cover for the club’s World Cup-bound players.
New Zealand-born Te’o will arrive in Toulon on Thursday ahead of completing a medical on Friday.
He is expected to join Toulon training next week.