The two-term governor, who has had a difficult time getting attention in the Republican race, is expected to announce his decision at a news conference on Dec. 28 in Santa Fe, Politico reported Tuesday night.
Johnson has been talking to the Libertarian Party for weeks, Politico said. Libertarian Party chairman Mark Hinkle said news of Johnson's switch is "the worst kept secret."
Hinkle said Johnson was a dues-paying member of the Libertarian Party while serving as the Republican governor of New Mexico.
Johnson is in favor of lower taxes, small government and gun rights. He is also pro-choice on abortion and favors the legalization of marijuana, putting him at odds with social conservatives.
Libertarian Party executive director Wes Benedict said Johnson will need to compete for the nomination in May at the party's convention in Las Vegas.