Royals are believed to have agreed a fee of around £2.5 million for the Hornets' Player of the Year.
They failed with a £2 million bid for the versatile defender a few weeks ago but are now thought to have reached an agreement with the Championship club.
Earlier this week, New Watford boss Gianfranco Zola said he would not stand in Mariappa's way if a Premier League came in for him.
The defender has one year left on his Hornets contract and is now in the advanced stages of completing his move to Berkshire.
Royals also hope to tie up a deal to sign Newcastle United right-back Danny Simpson within the next week.
The 25-year-old has one year to run on his contract at St James' Park and has rejected a new deal.
Several rival Premier League clubs including Fulham and QPR are also chasing Simpson, but Reading will hope that ex-boss and Toon manager Alan Pardew can help their cause.
Royals boss Brian McDermott confirmed he plans to make two signings before the squad goes to Portugal on pre-season tour next Wednesday.
Speaking exclusively to the Chronicle, he said: "We're gong away to Portugal and I'd like to get a couple more in before then.
"We're close so watch this space. I'm looking to strengthen the squad the best I can and to give it balance in areas where we are short.
"I'm not going to say where they are but if you look at the team you will probably reach the same conclusions as me."
More to follow...........