A report posted on the Denver Post's website Monday night says Roy's younger brother, Stephane Roy, leaked the impending announcement.
"They're discussing the final details of an arrangement," Stephane Roy told the denverpost.com. "Colorado is going to be very happy. Patrick is looking for a new challenge."
Patrick Roy would take over from fired Joe Sacco, who was let go after Colorado finished this season last in the Western Conference with a 16-25 record.
Roy played in Colorado for eight seasons before retiring in 2003. He won a Stanley Cup with the Avs in 1996 and 2001.
After retiring, the 47-year-old bought into the Quebec Remparts of the Quebec Major Junior Hockey League, becoming vice president of hockey operations and then their head coach in 2005. Roy led the Remparts to a Memorial Cup victory the following season.
Roy would be reunited with former teammate and fellow Hall of Famer Joe Sakic, who became the vice president of hockey operations on May 10.
Stephane Roy told the Denver Post that Sakic has been at Patrick's home in Florida the last few days working out the arrangements.