Reid will be in charge of acts including Usher and Pink as he takes control of the company, which will combine the rosters of Jive and Epic.
The 55-year-old executive will take the helm after July 4, according to The Hollywood Reporter.
His "new era" at the label has already begun and new signings apparently include YouTube hit girl-guy duo Karmin.
Reid is currently touring the US with Simon Cowell, Nicole Scherzinger and Paula Abdul filming auditions for the first season of X Factor USA.
There is speculation that the X Factor USA winner will be signed to Reid's new wing of Sony Music, but it has not been confirmed by Cowell yet where the $5 million champion will end up.
> LA Reid leaves Def Jam for 'X Factor USA'
> Simon Cowell: 'LA Reid an obvious choice for X Factor'