Bassem Naim, an adviser to Hamas' premier for the Gaza Strip, Ismail Haniyeh, said a senior member of President Mahmoud Abbas' Fatah movement, which dominates the PLO, would meet with Hamas officials in Gaza this week to conclude negotiations.
Azzam al-Ahmad is "arriving in Gaza on Wednesday and Thursday to meet with the Hamas reconciliation delegation to hold consultations," Naim told AFP.
"We expect the government to be announced by (Abbas) early the following week," he said, and will then be presented to the Palestinian parliament for a vote of confidence.
Hamas signed a reconciliation deal last month with the PLO in a surprise move which aims to overcome a years-long intra-Palestinian split.
Hamas has dominated the Palestinian parliament since winning a landslide victory in the last parliamentary election, held in 2006.
But the US and Europe have since backed the West Bank-based Palestinian Authority under Abbas and boycotted the Islamist movement, which advocates armed conflict with Israel.
Under their April 23 reconciliation deal, the two sides are to form an "independent government" of technocrats, headed by Abbas, paving the way for long-delayed elections.
Representatives from the rival factions have held several rounds of talks to heal the bad blood since Hamas expelled Fatah from Gaza in a week of deadly clashes in 2007.
The reconciliation deal has incensed Israel, putting the final nail in the coffin of faltering US-led peace talks between Israel and Abbas' administration.