The 84-year old Murdoch may officially make the handoff about a week from now, when the corporate board meets. Succession is on the agenda, a spokesman said.
According to CNBC’s sources, Carey -- who has been in the post since 2009, replacing Peter Chernin -- will also depart in 2016, but will retain an unspecified, possibly advisory role at the company. Carey recently signed a contract that gave him an out to leave the company early.
With Carey leaving, the company will be left without a non-family member in the upper reaches of management.
James Murdoch will reportedly be chief executive officer of 21st Century Fox, taking over day-to-day management of the company. Rupert Murdoch's other son, Lachlan, will become executive co-chairman. He is currently non-executive co-chairman.
Murdoch will reportedly continue as executive chairman of the company. The change would be announced in the near term, but would not occur until 2016.
In a statement, 21st Century Fox said: "The matter of succession is on the agenda at our upcoming, regularly scheduled board meeting.”
James Murdoch was embroiled in the U.K hacking scandal four years ago and gave up running BSkyB to work with Carey as COO. Rebekah Brooks, a top editor at the center of the hacking scandal, recently moved to the United States, reportedly to help the company find Internet start-ups to invest in.
Lachlan, who many once expected to be the heir apparent, worked himself back into the inner circle after he went through a period of distancing himself from the daily operations of the company.