If the transaction happens, Oracle would become ByteDance's technology partner responsible for the management of TikTok's data and take a minority stake in TikTok, according to sources.
US President Donald Trump has said Silicon Valley tech giant Oracle is "very close" to sealing a deal with TikTok to avoid a ban in the United States.
Trump's comments, on Tuesday, came a day after US officials confirmed that Oracle was set to become the US partner of the Chinese-owned popular video app by ByteDance.
The US is by far the largest TikTok market in terms of revenue, which it generates by selling advertisements.
"I heard they're very close to a deal," Trump told reporters, adding that "we're going to make a decision pretty soon" on whether to approve the tie-up, which would make Oracle a "trusted technology provider" for TikTok.
The deal announcement came ahead of a deadline set by President Trump in early August for the app to sell or shut down its US operations.
Calling TikTok a national security threat, Trump said if a purchase agreement was not reached by September 20, the platform would be banned in the US.
The Oracle bid would next need approval from the White House and Committee on Foreign Investment in the United States, a source told the Journal, with both parties under the belief it would meet US data security concerns.
Details of the deal remain unclear. But the Financial Times reported that ByteDance was to place TikTok's global business in a new US-headquartered company with Oracle investing as a minority shareholder along with other US investors.
CNBC reported the Trump administration could approve the deal as soon as Tuesday afternoon.
Tech giant Microsoft was also bidding for a deal with TikTok but said this week its offer was rejected, leaving Oracle as the sole remaining bidder
If the transaction between Oracle and ByteDance happens, it would avoid an outright sale of TikTok while giving a stake in the popular app to Oracle.
Oracle's founder Larry Ellison is a prominent Trump supporter.
Trump told reporters Tuesday he had "high respect for Larry Ellison."