The report claims the Gunners have offered a contract in excess of £130,000-a-week, and the player and his father Jorge - who also acts as his agent - are happy with the deal on the table.
The £22m fee would shatter Arsenal's current transfer record, and provide a shot in the arm for fans who've been calling for the club to make a big-money, big-name signing for the past few seasons.
Real Madrid made it clear Higuain was available earlier this summer, and Arsenal immediately became frontrunners along with Juventus for his signature.
The Argentina international is eager to complete the move to the Emirates Stadium after talks with Arsene Wenger, and the club hope to seal the deal before Arsenal travel to the Far East for their pre-season tour in three weeks' time.
Juventus were in the mix for Higuain, but they're now set to prioritise the capture of Fiorentia striker Stevan Jovetic - another name linked with Arsenal.
But the report warns a stumbling block to the Higuain transfer remains final ratification from Real Madrid.
The two clubs have reportedly reached a £22m deal, but the fee has not been finalised and the Spanish giants may look to use interest from elsewhere to bump up the striker's price.
But Wenger is confident of signing his top summer target, who would compete with Olivier Giroud for a starting place at the head of the Arsenal attack.