That's what I'm hearing from two people I trust. I've learned to keep a cool distance from coaching search rumors, so take this with all necessary caveats.
If what's being said is true, though, we might get an announcement as early as tomorrow morning. Fingers crossed.
Update [2008-1-4 1:13:39 by HornsFan]: The Statesman is reporting that no deal has been reached. This as of five minutes ago. Again, coaching rumors are wrong more often than they're right. For his part, Auburn coach Tommy Tubberville says he doesn't believe Muschamp will leave. If I needed another reminder of why I try my best to stay out of this particular rumor game, this is is one of 'em.
In any case, for now it's "Stay tuned." If it's not Muschamp, then the next set of rumors will fly in just as fast. We'll try to keep pace with it, but this as unpredictable a game as there is.
Update [2008-1-4 1:19:57 by HornsFan]: Jesus, it's a good thing I'm on the west coast; this might go all night. After the Statesman refuted Orangebloods' original report, the Texas Rivals site has countered with an official story that the deal is done. By the way, this is all happening virtually simultaneously. Somebody's wrong here.
I called the one person I know who could give me a definitive statement about what's actually happening right now, but I can't reach him. So I'm stuck on the sidelines with everyone else. I'm hearing from solid sources the deal is done. Orangebloods is confident enough with what they know to run a story on the hire being made. But the Statesman says this thing's in limbo. Buckle up...
Update [2008-1-4 10:2:4 by HornsFan]: Still nothing official on this, but both Texas premium sites are reporting that Muschamp has agreed in principle to come to Austin. Without official confirmation from the UT athletics department or Muschamp's agent, the Statesman, DMN, and Houston Chronicle are all running stories that fall short of calling it a done deal.
I'll hold off on popping the champagne until the official announcement, no matter how good this looks right now.