Eriksson, who originates from Värmland in Sweden, left Iran Thursday after holding talks with Persepolis FC official, the state news agency IRNA reported.
The nomadic manager, known affectionately as "Svennis" in his homeland, flew to Dubai after the negotiations held Wednesday night on Iran's Kish Island, in the Gulf, the agency said.
"He will later announce his decision on our proposal," Persepolis football club president Mohammad Rouyanian was quoted as saying.
British newspapers this week reported the struggling Iranian side was looking to spend around £1 million ($1.6 million) to secure Eriksson, who left Leicester City last month by "mutual agreement".
The 63-year-old Swede had signed a two-year contract with Leicester City just a year earlier, after a number of unsuccessful spells - including with Manchester City, Mexico and League Two outfit Notts County - since leaving the England job, which he held 2001-2006.
Prior to the England job, Eriksson enjoyed successful spells with IFK Gothenburg, where victory in the 1982 UEFA cup paved the way for him to try his managerial skills in Europe's major leagues.
Benfica was his first port of call and after two league wins he moved to Italy, spending time at Roma, Fiorentina and Sampdoria and finally a successful four years with Lazio, crowned with a Serie A league win in 2000.