City boss Roberto Mancini  has been a big fan of the 21-year-old since seeing the player put in a dominant display in a Premier League tie in 2010, with the England international snuffing out the influence of Spanish playmaker David Silva when Everton visited Manchester last season.
Although no fee has been reported, Everton are understood to value their key asset at around 20-million pounds ($31.3 million).
Rodwell won his first England cap last season and was widely tipped to feature at Euro 2012 and the Olympics before injury ruled him out of contention.
The player is expected to be a regular international in the future and is a popular figure at Goodison Park after joining the club aged 7.
“Everton have agreed an undisclosed fee with Manchester City for the transfer of Jack Rodwell,” said an official statement on the club’s website.
“The midfielder is set to undergo a medical with the Premier League champions Sunday.”
Mancini was delighted to announce the signing, describing Rodwell as an “important player.”
“We consider Jack Rodwell to be a good, young player,” he said.
“He will be an important midfielder for the England national team and for us. We need someone who wants to win, is good tactically and is a good player for the future.”
Mancini has recently voiced his frustration at City’s lack of activity in the transfer market this summer, saying he was “not happy” about the club’s reluctance to spend big to bring arrivals to the Etihad Stadium and blaming club executive Brian Marwood for the lack of signings.
The Daily Mirror reports that the Italian has been summoned for “peace talks” with Marwood by City’s owners, with chairman Khaldoon al-Mubarak said to be taken aback by Mancini’s very public outburst.
Relations between the two are said to have broken down to the extent that they no longer communicate directly any more, with Mubarak keen to broker a truce.
Mancini is keen to add to his squad, believing himself to be in a strong position after delivering City’s first league title since 1968, yet Marwood is responsible for keeping the playing-staff at a manageable level.
“Roberto is frustrated because the club haven’t given him everything he has demanded,” a source told The Mirror.
“It is tricky – both Roberto and Brian are valued tremendously by the owners.”
Chelsea manager Roberto di Matteo has quashed talk of striker Daniel Sturridge leaving Stamford Bridge, confirming that he sees the England international as a key part of his squad.
The Champions League and FA Cup holders have spent lavishly on attacking players this summer, bringing Marko Marin, Eden Hazard and Oscar to the club in recent weeks.
The Blues are also expected to press ahead with moves for Porto’s Brazilian striker Hulk and Wigan Athletic’s Victor Moses.
However, di Matteo has dismissed that these additions spell the end of Sturridge’s Chelsea career, who has been linked with moves to Tottenham and Liverpool.
“I see him as part of my plans, absolutely,” the Italian said.
“He's part of the squad and the team and still has a lot to give.
“He still has a lot to learn as well, but we're hopeful he can develop even more and become a fantastic and great player for us.”
QPR manager Mark Hughes has targeted Tottenham defender William Gallas as the Welshman looks to add to his defensive options.
The former Chelsea and Arsenal center back will be allowed to leave White Hart Lane by Spurs boss Andre Villas-Boas, with the Portuguese believing the Frenchman to be surplus to requirements.
However, Hughes sees the 34-year-old as capable of adding vital experience to his side.
If a move is completed, QPR will become Gallas’ fourth London club after joining Tottenham two seasons ago.
Stoke City’s ambitious attempt to sign former Liverpool and Real Madrid striker Michael Owen hang in the balance, with The Daily Telegraph reporting that the club are nowhere near close to agreeing terms with the 32-year-old.
Owen was released by Manchester united at the end of last season, after a three-year spell at Old Trafford was blighted by injury.
The forward is keen to remain in the Premier League but a deal bringing him to the Britannia Stadium looks doomed after the player rejected a play-as-you-play deal.
Stoke offered a 12-month contract, with a promise of an extension should Owen play a certain number of games but the player’s representatives are said to be looking for a more financially secure deal.
Owen has scored a national record of 26 competitive goals for his country, hitting the back of the net 40 times in total for England.
Liverpool manager Brendan Rodgers is still keen on signing Arsenal winger Theo Walcott, believing the England international would inject both pace and width to his squad.
Chelsea have also expressed an interest in signing Walcott, who’s future at the Emirates Stadium looks in doubt after it was revealed the player has just 12-months to run on his current deal.
Although the winger has not expressed a desire to leave the Gunners, Walcott’s place in Arsenal’s first XI could be under threat following the emergence of Alex Oxlade-Chamberlain and the signings of Lukas Podolski and Santi Cazorla.
Liverpool are yet to approach Arsenal, but British daily Metro reports that Rodgers is intent on making Walcott his next acquisition following the arrivals of Joe Allen from Swansea and Fabio Borini from Roma.