The Swede, 63, is eyeing a move to struggling Persepolis FC, based in the strict Islamic republic's capital Tehran.
Chiefs claimed yesterday they were in talks to lure the soccer journeyman — who has managed a host of clubs and national teams — into a deal worth around £1million.
Football sources said Sven is considering a trip to Dubai to meet Mohammad Ruyanian, new general manager of Persepolis.
Ruyanian said: "We are going to sign a big coach. We have negotiated with Sven Goran Eriksson."
High-living Sven faces a drastic lifestyle change if he moves to Iran, run by ranting Mahmoud Ahmadinejad. Booze is banned and glam women like Sven's ex Nancy dell'Ollio could be lashed for failing to wear a veil in public.
Sven earned up to £5million-a- year while failing to deliver a trophy during five years with England.
His career has taken him to six countries — including two Scandinavian clubs, Benfica of Portugal, plus Roma, Fiorentina, Lazio and Sampdoria of Italy. But he disappointed at Man City and Notts County and was fired by Leicester City last month.
By NICK PARKER and CHRIS POLLARD