MIDDLE-EARTH TIMELINE
There are two ways to read Tolkien's Middle-earth books: in the order they were published, or in the order of the events they tell. For a first read, publication order is the easiest way in.
In story order, The Silmarillion and the Great Tales come first, then The Fall of Númenor (Second Age), The Hobbit and The Lord of the Rings. Starting with The Silmarillion is possible, but it reads like a chronicle rather than a novel, and it is easier once you know Middle-earth.
Going further, the twelve volumes of The History of Middle-earth show how Tolkien built his world draft after draft. The full list below is in chronological order; see also the Tolkien books timeline.
Most readers start with The Hobbit, then The Lord of the Rings, then The Silmarillion. The Children of Húrin, Beren and Lúthien and The Fall of Gondolin are good next steps.
It is recommended but not required. The Lord of the Rings recalls what happened in The Hobbit, but reading The Hobbit first explains how Bilbo found the Ring and introduces Gandalf, Gollum and the Shire.
It comes first chronologically, but it was published after Tolkien's death and is closer to a history than a novel. Most readers find it easier after The Lord of the Rings.
The Fellowship of the Ring, The Two Towers and The Return of the King. Tolkien wrote it as a single novel in six books; it was published in three volumes in 1954 and 1955.