The Louisville metro government will pay several million dollars to the family of Breonna Taylor.
The settlement will be the largest sum paid by the city for a police misconduct case, according to a person who has seen the agreement. It will also include police reforms in relation to the handling of warrants.
The 26-year-old was fatally shot by police who broke down her apartment door while serving a narcotics warrant on March 13.
Ms Taylor was hit five times and died in the hallway. Police found no drugs at her home.
It sparked months of protests in Louisville and nationwide calls for the officers to be charged.
State attorney general Daniel Cameron is investigating police actions in the March 13 shooting.
Meanwhile, the police officers involved have not been charged. Brett Hankison has been fired while Myles Cosgrove and John Mattingly remain on administrative reassignment.
The lawsuit, filed in April by her mother, Tamika Palmer, alleged the police used flawed information when they obtained a “no-knock” warrant to enter her apartment.
The suit accused three Louisville police officers of blindly firing into Ms Taylor’s apartment, striking her several times.
Her boyfriend, Kenneth Walker, was in the apartment with her and fired a single shot that struck an officer in the leg.
He said he did not hear police announce themselves and thought he was guarding against an intruder.
The city of Louisville is expected to announce details on Tuesday afternoon.
The largest settlement previously paid in a misconduct case was $8.5m in 2012, to a man who spent nine years in prison for a crime he did not commit, according to news reports.
