Such a move will set up a showdown with Republicans, who have blocked Democrats' efforts in Congress to reform immigration laws and warned the president not to take unilateral action on immigration.
The Times, citing unidentified administration officials with direct knowledge of the plan, said Obama's proposed overhaul may be announced as soon as next week. Officials said it would allow many parents of children who are U.S. citizens or legal residents to obtain work documents and stay in the United States.
The Times said Obama's plan will provide more opportunities for immigrants with high-tech skills and add security resources to the border with Mexico. Undocumented immigrants with family ties in the United States and no criminal record also would be considered lower priority for deportation than those with criminal records or who are considered security risks.
Republicans, who won control of Congress in Nov. 4 elections, have warned Obama not to take unilateral action on immigration.
Obama told congressional leaders last Friday he was committed to using executive powers to ease some restrictions on undocumented immigrants since Republicans in the House of Representatives had refused to advance immigration legislation.
Mitch McConnell, who will be Senate majority leader starting in January, said if Obama took unilateral action on immigration, it would be like "waving a red flag in front of a bull."
When the new Congress convenes in January, Republicans will have majorities in both chambers.