The former Archbishop of York Dr John Sentamu is expected to get a life peerage after the government was accused of "institutional prejudice" for failing to ennoble him.
Dr Sentamu, the UK's first black archbishop, retired in June after 15 years.
Despite all his predecessors being made peers and allowed to continue sitting in the House of Lords he was not.
But a source told the Press Association the move was now "imminent".
The Whitehall source said the delay was due to a procedural hold up with the House of Lords Appointments Commission.
Previously a No 10 spokesman had told the Sunday Times Dr Sentamu was kept off the list to keep House of Lords numbers down, despite the prime minister including his brother, Jo Johnson.
As an archbishop, Dr Sentamu was among the 26 lords spiritual who have places reserved in the upper chamber of Parliament for Church of England bishops.
After he stepped down, Dr Sentamu was informed by No 10 he was in line for a peerage and was asked to confirm his suitability and willingness to accept, the Times reported.
However, a month later he was told that his name would not be included.
His successor, the Most Reverend Stephen Cottrell, said he had been "disturbed" at the move.
David Lammy, the shadow justice minister, said on Twitter: "No 10 broke a precedent and snubbed Britain's first black archbishop for a peerage because it says the House of Lords is too large, but it made room for Ian Botham, Claire Fox and Theresa May's husband.
A No 10 spokesman said the process for Dr Sentamu's nomination was "well under way".