The source said Huntsman has accepted the appointment.
An announcement was expected at the White House Saturday morning.
The 49-year old Huntsman is a Mormon who liberalized Utah's restrictive liquor laws and has nudged the state in a more moderate direction on the environment and gay rights.
Huntsman has been mentioned as a potential 2012 presidential contender. He served as ambassador to Singapore under President George H.W. Bush. He speaks Mandarin Chinese and has an adopted daughter from China.