Chao, 63, was the secretary of labor in the administration of President George W. Bush and the first Asian-American woman to hold a Cabinet-level position. She is married to Senate Majority Leader Mitch McConnell, R-Ky., and has experience in Washington's Republican establishment, The New York Times reported.
She met with Trump in New York City last week to discuss transportation and labor policy, members of Trump's transition team said.
Her appointment to lead the Department of Transportation could make her an integral part of shaping one of the most ambitious plans in Trump's agenda. During his presidential campaign, Trump repeatedly said infrastructure improvement, including highways and bridges, would be a priority in his administration. He called for spending of $1 trillion on renewing roads, ports, bridges, public transportation and other transit systems.
An announcement of Chao's nomination is expected Tuesday afternoon.