Smith Rowe, who joined Arsenal at the age of 10, worked his way through the club's academy setup before breaking into the first-team squad.
The 24-year-old has made 115 competitive appearances for the North London club, scoring 18 goals and providing 13 assists.
However, the Arsenal academy graduate has found playing time hard to come by over the last two season, featuring in just 14 matches in 2022-23 and mustering 19 appearances in 2023-24.
With his playing situation unlikely to improve, Smith Rowe has been open to a departure to gain regular game time elsewhere.
Fulham set to sign Smith Rowe
According to Sky Sports News, Fulham have reached an agreement with Arsenal to sign Smith Rowe in a record deal worth up to £34m.
The Cottagers will pay an initial £27m fee, plus a further £7m in add-ons depending on cup and European success for the West London club.
The midfielder, who has three England caps to his name, has already agreed personal terms in principle ahead of his move to Craven Cottage.
The two clubs are now working out the final details of the transfer, with Smith Rowe set to undergo a medical with Fulham this week.
Smith Rowe will become the sixth player to leave Arsenal this summer following the loan exits of Albert Sambi Lokonga and Nuno Tavares as well as the permanent departures of Mohamed Elneny, Cedric Soares and Arthur Okonkwo.
Smith Rowe to become Fulham's second summer signing
As long as there are no unexpected twists, Smith Rowe will be unveiled as Fulham's second addition of the summer transfer window.
The Cottagers recently announced the re-signing of Ryan Sessegnon, who has returned to the club after being released by Tottenham Hotspur.
Fulham are hoping Smith Rowe will be able to link up with his new teammates for the club's pre-season training camp in Portugal.
Marco Silva's side are scheduled to face Portuguese giants Benfica on Friday, before they face Spanish side Sevilla next Monday.