Lattanzio has guided the club since original manager Miguel Angel Ramirez was fired after 14 matches.
The team is 9-11-1 under Lattanzio, but remains four points out of playoff position with three matches remaining.
PREVIOUSLY: Charlotte FC fires its head coach
The source confirms the club and Lattanzio are working out a long-term deal to install him as full-time manager.
Charlotte FC hosts Philadelphia Union on Saturday at 5:30 p.m.
The club parted with Ramirez in May 2022. Owner David Tepper said at the time it was a "difficult decision". Ramirez took to social media to thank fans for their support.
Other coaches that departed with him included assistant coach Mikel Antía, head fitness coach Cristobal Fuentes Nieto, and first team video analyst Luis Piedrahita. Goalkeeper coach Andy Quy remained on staff.
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