Jadeja is right behind teammate and India's star off-spinner Ravichandran Ashwin, who sits comfortably at the top of the table.
Jadeja's maiden 10-wicket match haul against England in the fifth and final Test match was his career best performance. Jadeja's performance has earned him 66 points and brought him within eight points of Ashwin.
"This is just the second time the top two spots in the ICC Player Rankings for Test Bowlers have been occupied by India players, with the pair emulating left-arm spinner Bishan Singh Bedi and leg-spinner Bhagwath Chandrasekhar, who were ranked one and two in 1974," said an ICC official release.
Jadeja grabbed 10-154 in the final Test and finished with 26 wickets in the five-match series while Ashwin ended with 28 wickets as India completed a 4-0 series victory, culminating with an innings and 75 runs win in Chennai.
Jadeja, who leapfrogged Josh Hazlewood, James Anderson, Dale Steyn and Rangana Herth, has also gained one place to reach a career-best third rank in the list of all-rounders, also led by Ashwin.
Australia pace bowler Mitchell Starc is another one to rise in the rankings as he has moved up two slots to a career-best sixth position after taking seven wickets in the first Test against Pakistan in Brisbane, which his team won by 39 runs to take a 1-0 lead in the three-match series.
Pace bowlers Ishant Sharma of India (up two places to 23rd rank), Wahab Riaz of Pakistan (up two places to a career-best 24th rank) and Australia's Jackson Bird (up five places to 48th) are the others to make upward movements.
ICC Rankings for Test bowlers (as on December 21, 2016, after India-England 5th Test in Chennai)
1. Ravichandran Ashwin (India) 887 points
2. Ravindra Jadeja (India) 879 points
3. Rangana Herath (SL) 867 points
4. Dale Steyn (SA) 844 points
5. James Anderson (Eng) 810 points