Willock, 21, spent a productive loan spell at St James' Park last season, scoring eight goals to ensure the Magpies preserved their Premier League status.
Manager Steve Bruce has made no secret of his desire to bring the England Under 21 international back to the north-east and Press Association and BBC both reported Sunday that a fee has been agreed between the two clubs.
Willock was absent from Arsenal’s matchday squad for their pre-season defeat to Tottenham Hotspur on Sunday, with manager Mikel Arteta coy when asked about a potential move.
“With Joe will explain the reasons when we can,” he said.
“It’s all I can say now. When I can say more I will let you know.”
Willock's expected arrival will go some way to soothing a fan base unhappy about the lack of signings this transfer window. The Englishman scored seven goals in as many Premnier League games during Newcastle's run-in to ensure their survival.
It is understood Willock has yet to agree personal terms with Newcastle but a permanent move now looks on the cards for the talented midfielder who has failed to nail down a regular starting berth at Arsenal since making his debut in 2017.
Arteta is not blessed with central midfield options with Belgium U21 midfielder Albert Sambi Lokonga the only addition so far. Arsenal have been linked with Leicester City midfielder James Maddison as a potential replacement, but on Thursday Foxes boss Brendan Rodgers said he thought the England international would stay.
Granit Xhaka is reportedly close to agreeing a new deal after a move to Roma fell through while Thomas Partey is in a race against the clock to be fit for the Gunners' Premier League opener against Brentford on Friday.