Talks between both clubs are thought to be at an advanced stage and Sunderland are hoping to tie up a deal for Rodwell in the next 24 hours.
Should Sunderland land the 23-year-old, the signing would be something of a coup for Gus Poyet's side with a host of clubs chasing the player's signature.
Half of the Premier League are believed to have been keeping tabs on Rodwell's situation, but Sunderland have emerged as favourites to land the England international.
City are willing to let Rodwell move on as he has struggled to establish himself at the Etihad Stadium due to a series of injuries since his arrival from Everton in the summer of 2012.
Rodwell made just 10 appearances for City last season and the arrival of Fernando from Porto this summer has increased the competition for places in City's star-studded line-up.
The Southport-born star is ready to move on in search of regular first-team football as he looks to kick-start his career and boost his chances of breaking back into the England set-up, with his last of three caps to date coming against Brazil in a friendly at the Maracana in June 2013.