Fulham officials said they expect to be able to name their new boss within 48 hours and it is understood Hughes’ contract will be worth in the region of Ã‚Â£2 million-a-year.
The Craven Cottage club were last week unable to secure the services of their first choice Martin Jol after the Dutchman opted to stay at Ajax.
Fulham have been on the hunt for a new manager since Roy Hodgson departed for Liverpool after a successful final season at Craven Cottage in which he guided his side to the Europa League final.
Hughes, 46, was sacked by Manchester City last December after being appointed at Eastlands in the summer of 2008. It is understood that the Welshman will bring in Mark Bowen as his assistant.
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