Brentford’s Toney, 27, is the second-highest English goalscorer in the Premier League this season with 16 goals, behind Tottenham’s Harry Kane.
However, he is facing a potential ban from the game having accepted breaking Football Association betting rules.
The matches will be England’s first since they were knocked out by France in the World Cup quarter-final in December.
Liverpool right-back Trent Alexander-Arnold is one of five players picked for the tournament in Qatar who are not in Southgate’s latest 25-man squad.
The others are defenders Conor Coady and Ben White, striker Callum Wilson and the injured Raheem Sterling.
Chelsea’s right-back Reece James and left-back Ben Chilwell missed the World Cup through injury but return to the squad, along with Crystal Palace defender Marc Guehi.
Toney was charged with 232 betting breaches in November and a further 30 in December, and a disciplinary hearing has yet to take place.
“He is playing for his club and available for them,” said Southgate. “There hasn’t been a trial or any judgement so I don’t know on what basis we wouldn’t pick him.
“Ivan has been consistent across the season. He is playing really well. I like his presence in games.”
The forward has helped Brentford to eighth in the Premier League this season and scored the equaliser in a 1-1 draw with top-flight leaders Arsenal in February.
“I saw his game against Arsenal where he was outstanding and he deserves his opportunity,” Southgate added.
‘Walker situation is complicated’
Manchester City right-back Kyle Walker has been picked, despite Cheshire Police launching an investigation after a newspaper alleged he indecently exposed himself in a bar.
“It is a complicated situation, I have spoken at length with him,” said Southgate.
“He is back playing with his club, there is no conclusive evidence to leave him out at this stage. I have to be careful on being the moral judge on things.
“We have had a couple of long conversations, we feel we want him with us, but we know when you’re an England player there is an even higher bar on how you conduct yourselves and what is expected.
“We are not taking those decisions lightly.”
On the omissions of White and Alexander-Arnold, the England manager said: “There are three boys that are in as right-backs, we’ve got them just ahead of those two.
“We’re blessed in that position with a depth of talent and it’s the hardest position to pick, albeit it’s never straightforward criteria and it’s always shifting around a little bit on form.”
Goalkeepers: Jordan Pickford (Everton), Nick Pope (Newcastle), Aaron Ramsdale (Arsenal)
Defenders: Ben Chilwell (Chelsea), Eric Dier (Tottenham), Marc Guehi (Crystal Palace), Reece James (Chelsea), Harry Maguire (Manchester United), Luke Shaw (Manchester United), John Stones (Manchester City), Kieran Trippier (Newcastle United), Kyle Walker (Manchester City)
Midfielders: Jude Bellingham (Borussia Dortmund), Conor Gallagher (Chelsea), Jordan Henderson (Liverpool), James Maddison (Leicester City), Mason Mount (Chelsea), Kalvin Phillips (Manchester City), Declan Rice (West Ham)
Forwards: Phil Foden (Manchester City), Jack Grealish (Manchester City), Harry Kane (Tottenham), Marcus Rashford (Manchester United), Bukayo Saka (Arsenal), Ivan Toney (Brentford).