LaHood, 63, did not seek re-election this year. He was first elected to Congress from Illinois' 18th district in 1994.
If confirmed by the Senate, LaHood would be the second Republican in Mr. Obama's cabinet, along with current defense secretary Robert Gates, who Obama has asked to stay on for a year or more.
CBS News also confirmed today that Mr. Obama is set to name Mary Schapiro to head the Securities and Exchange Commission.
Schapiro, a Democrat, served as a financial regulator in the Reagan, George H.W. Bush, and Clinton administrations.
The SEC is under intense scrutiny for its lax oversight of Wall Street leading up to the current economic crisis and its failure to thoroughly investigate fraudulent money manager Bernard Madoff despite repeated warnings.
The SEC chairmanship also requires Senate confirmation, although it is not a cabinet-level post.
Obama will announce the Schapiro pick at a 10:45 a.m. ET news conference tomorrow. It is not clear whether or not he will name LaHood as his transportation pick at that time as well.