The deputy director-general of MI5 will reportedly become the new chief of GCHQ.
Former GCHQ director Robert Hannigan announced he was stepping down from the spy agency in January, citing pressures on his personal life.
Jeremy Fleming will be named head of the intelligence and security organisation, The Sunday Times reports.
He has worked at MI5 for at least 20 years and had a role managing security at London 2012.
His appointment comes as the agency publicly denied it helped former President Barack Obama spy on Donald Trump, calling the evidence-free allegations “utterly ridiculous”.
Fox News commentator Andrew Napolitano alleged during a Fox & Friends broadcast Mr Obama had bypassed the US’ intelligence community and used the UK’s spy centre to monitor Mr Trump's communications.
The claim was repeated by White House press secretary Sean Spicer as he defended Mr Trump's claim Mr Obama "had my wires tapped".
A spokesperson for GCHQ said: "Recent allegations made by media commentator Judge Andrew Napolitano about GCHQ being asked to conduct 'wire tapping' against the then-President elect are nonsense.
“They are utterly ridiculous and should be ignored.”
Mr Fleming’s major challenge will be to maintain GCHQ’s relationship with US intelligence agencies, a source told The Sunday Times.
“Jeremy will be expected to make a trip to the US very early on to seek reassurances from our partners.
“I don’t think the rubbish being uttered by the Trump camp will affect the day-to-day operational co-operation between the UK and US intelligence agencies, but it’ll be important to remind our partners there that more consideration and respect need to be afforded to the intelligence communities by the Trump administration.”