The EU is set to offer Britain the option of an "emergency brake" that could help limit immigration from other EU states, sources have told Reuters news agency.
The measure would allow Britain to withhold in-work benefits to migrants arriving from the EU until they have been in the UK for up to four years.
David Cameron, who proposed the measure as one of number of reforms to Britain's membership of the bloc, hopes that it will help curb the number of migrants arriving each year.
However, any such deal would represent a significant concession from Brussels.
The Prime Minister will discuss the proposal in Brussels on Friday with European Commission President Jean-Claude Juncker, sources close to the negotiations told Reuters.
He has been pushing for changes aimed at loosening ties with Brussels ahead of an in/out referendum on the UK's membership.