Mourinho is reported to have agreed an extension to his current deal that will keep him at Old Trafford beyond 2019.
Starsport understands no announcement is imminent because a few small details have still to be finalised.
But Mourinho has agreed to the offer in principle and United could reveal the contract extension next week once the signing of Alexis Sanchez from Arsenal has been completed.
The news is a huge boost to United and will kill speculation that Mourinho is unsettled in Manchester and wants to leave.
Mourinho, who has been linked with a move to Paris St-Germain this summer, took charge in 2016 and won two trophies in his first season in charge, as well as the Community Shield.
United are second in the Premier League table this season, albeit 12 points behind leaders City and have reached the knockout stages of the Champions League.
Supporters have seen Mourinho sign Paul Pogba and Romleu Lukaku since replacing Louis van Gaal as boss.
The Portuguese is also on the brink of landing Chilean superstar Sanchez from the Gunners to bolster his side even further.
Old Trafford bosses, led by executive vice chairman Ed Woodward, have been impressed with the team's progress under Mourinho and were keen to tie him down to a longer deal.
Mourinho has insisted he is happy in Manchester - despite living apart from his family who remain in London - and that he wanted to stay past his current deal.
He said: "If you want to ask me directly if I see myself next season at Manchester United, then I say I see myself here.
"As I said when I arrived, I am going to leave when the club wants me to leave because I have no intention to leave at all.
"My intention is to stay and to work and to improve and to bring the club to where the club belongs. And I want to stay. I do not see any reason not to stay.
"I still have a contract. In fact I am in the middle of my contract. I am not in the last couple of months.
"My desire is to stay until the owners and the board is happy with my work. If I am going to sign a new one of course depends on the club but my commitment with the club is total and I want to stay.
"It is just a question of whether the club, the owners, the board, Mr Woodward are happy with my contribution and they want me to stay beyond the end of this contract. But yes I want to stay."