Haley is the first Indian-American to ever appointed to a Cabinet position in any US presidential administration.
Trump is expected to make the announcement on Friday, the reports said.
If confirmed, Nauert, a former Fox News anchor who has served as the public face of the State Department since last year, would be one of the most prominent promoters of Trump’s 'America First' foreign policy.
Nauert, 48, worked for Fox News from 1998 to 2005 and, after two years away during which she worked for ABC, she returned to Fox in 2007, later becoming a presenter for Fox & Friends.
Former deputy security council adviser Dina Powell and Trump's daughter Ivanka's names were initially floated as possible replacements.
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