It is understood that a compensation agreement is close to being secured between Stoke and the Irish Football Association.
The Potters are looking for their fifth manager in less than two years after sacking Nathan Jones last week with his team bottom of the Championship table.More news: Billie Eilish Debuts An Edgy New Mullet Haircut - See Before & After Pics
Stoke have endured a awful start to the season, sitting at the bottom of the Championship with just two league wins so far this season.
O'Neill was previously given permission to speak to Scotland but declined the role, while he has also attracted interest from West Brom and Sunderland, after raising Northern Ireland from 129th in the world to 20th in 2017.
They are third, behind Germany and the Netherlands, in their Euro 2020 qualifying group and face an uphill battle to qualify for next year's tournament. Gary Rowett was then sacked less than eight months into a three-year contract and now Jones has been axed after only 10 months in charge.More news: Rainsy stopped from boarding flight in Paris
The former Newcastle midfielder has been interested in a return to club management for some time and was linked with the Sunderland job in 2017 before turning down an approach from Scotland a year ago.
Regardless of those results a play-off place seems likely for Northern Ireland, which will surely factor into the 50-year-old's thinking as he ponders the prospect of taking over the Championship strugglers.
"But it is not a distraction for me".More news: Bill Gates Criticizes Warren's Wealth Tax Plan
The manager guided Northern Ireland to the European Championships in 2016, where they were eventually beaten in the last 16.