The retired defender is set to take charge of his country's national team more than six months after being sacked by Fiorentina, according to the body's president Tomislav Karadzic
The 43-year-old will take over from Vladimir Petrovic, who was dismissed after failing to guide Serbia to Euro 2012.
"Yes, we can announce that Serbia are on their way to getting a coach that we and the fans can trust [in Mihajlovic]," FSS president Tomislav Karadzic told reporters.
"There are still some minor details to be completed, but these are not things that can affect the final agreement and the common desire that is shared between us and Mihajlovic."
Mihajlovic, who is currently out of work after being sacked by Fiorentina in 2011, has also agreed to a substantial pay-cut in order to take the job. Reports in Serbia state that he will earn a salary of around €300,000 for his services.
Prior to his spell in Florence, the retired defender took charge of Bologna and Catania and was an assistant at Inter.