The Italian Football Federation and Luciano Spalletti have reached an agreement for him to succeed Roberto Mancini as coach of the national team, according to reports in the Italian press on Friday.
According to La Gazzetta dello Sport, Spalletti, the federation's top choice, will sign a three-year contract until September 2026.
The former Napoli boss has held several telephone conversations with federation president Gabriele Gravina and has now agreed to take over from Mancini.
Spalletti and Gravina are due to meet on Friday to finalise the contract.
Following his appointment, which could be made official on Saturday, Spalletti is expected to hold his first press conference as coach on Monday, the sports daily reports.
Spalletti, 64, was crowned Italian champion with Napoli in May, before stepping down as coach.
He will be in charge of reviving the national team which, despite winning the European title in 2021, failed to qualify for the 2022 World Cup in Qatar.
He will have just a few days to prepare for two matches that are already crucial if they are to defend their title at Euro 2024. They travel to Northern Macedonia on September 9 and host Ukraine in Milan three days later.
Negotiations with Spalletti have been complicated by the fact that his contract with Napoli, which runs until June 2024, includes a clause requiring him to pay compensation of 3 million euros ($3.3 million) if he takes up a new position.
The federation is looking at legal options but Napoli president and owner Aurelio De Laurentiis has said he will not waive the payment, which decreases by 250 000 euros each month, "as a matter of principle".