The Australian singer and fashion designer, who was previously a judge on the talent contest from 2007 to 2010, will replace Kelly Rowland on the panel, according to the Sunday Mirror.
The newspaper reports that Simon Cowell is keen to see Minogue, who is allegedly in negotiations with ITV, return to the show.
He is also said to have recruited Katy Perry as a guest judge for the new series. The 'Part of Me' popstar previously acted as a guest judge during Minogue's maternity leave in 2010.
A source close to the music mogul said: "Simon thinks she's great. They are still friends. If it works out, then it will be fantastic for X Factor. No formal offer has yet gone out, but this is likely to happen in the next few days."
The report comes just under two weeks after a controversial new biography of Cowell by Tom Bower revealed that he and Minogue had a secret affair during The X Factor's 2007 run.
Both Louis Walsh and Gary Barlow have confirmed that they will be returning to the judges' panel for the 2012 series of the show, with Tulisa Contostavlos also expected to continue in her role.
Watch Gary Barlow and Tulisa Contostavlos talking about The X Factor at the 2012 National Television Awards: