The Argentina international has fallen out of favour at San Siro following the appointment of Antonio Conte earlier this summer.
Icardi is reportedly set to sue the Serie A side for £1.4m after being excluded from some of Conte's first-team training sessions.
It was previously reported that the centre-forward was only interested in a move to Juventus, but he now appears set to join the Ligue 1 champions.
PSG will bring Icardi to the Parc des Princes on a season-long loan, but the former Sampdoria striker will sign a new Inter deal before departing.
The Nerazzurri are keen for Icardi to extend his contract in order to protect his valuation ahead of a permanent sale next summer.
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