The Tractor Boys, who parted company with Paul Jewell last week, interviewed several candidates on Tuesday, but are reported to have more talks lined up with the former Wolves and Sunderland boss on Wednesday morning.
While reports of a three-year deal already being agreed may be premature, it looks likely McCarthy will be handed the task of steering Town away from relegation trouble in the npower Championship, with an announcement expected before Saturday's trip to Birmingham.