Following the resignations of Federation president Gabriele Gravina and Italy team manager Gianluigi Buffon, Gattuso also chosen to leave.
According to TMW, the coach has reached an agreement with FIGC and an announcement is due shortly.
Gattuso leaves the post after this week's World Cup playoff defeat in Bosnia, where the Azzurri lost on penalties. It means Italy have now missed the past three World Cup finals.
Buffon announced last night that he had offered his resignation immediately after the defeat. Gravina later stated he had asked both Buffon and Gattuso to stay on, but things have changed over the past 24 hours.
Buffon confirmed on social media: "Submitting my resignation a minute after the end of the match against Bosnia was an urgent act, one that came from deep within me. It was as spontaneous as the tears and the pain in my heart that I know I share with all of you. I was asked to wait so that everyone could reflect properly."
He also stated: "Now that President Gravina has chosen to step back, I feel free to do what I feel is an act of responsibility, because, despite my sincere belief that we have built a lot in terms of team spirit and with Rino Gattuso and all the collaborators, in the very short time available to the national team, the main objective was to bring Italy back to the World Cup."
Gattuso had been negotiating the payoffs for his staff before finalising his own departure. But with things now settled, a statement from FIGC could confirm the clearout this afternoon.