Spurs have the option to purchase the Real Betis midfielder after the clause was included as part of the deal that saw Giovani Lo Celso join the Spanish club in the summer.
Tottenham can buy Cardoso for a fixed fee of €25m (£21m), although the clause will allegedly expire in June next year.
Alternatively, Tottenham will be eligible to receive a percentage of any future sale if they decide against signing Cardoso on a permanent deal.
Spurs make Cardoso decision
According to Football Insider, Tottenham are willing to activate Cardoso's release clause in the upcoming January transfer window.
The report claims that Spurs are prepared to push a deal over the line in a bid to ward off interest from one of their Premier League rivals.
Aston Villa are among the sides keen on signing the USA international, and their interest could force Tottenham to trigger Cardoso's release clause.
The North London club will be reluctant to allow Cardoso to join one of their rivals in the race for Champions League qualification.
Is their a place for Cardoso at Tottenham?
Tottenham's decision as to whether to sign Cardoso in January looks set to be influenced by rival clubs rather than a real desire to add him to Ange Postecoglou's side.
Postecoglou can currently call upon the likes of Yves Bissouma, Rodrigo Bentancur, Pape Sarr and Lucas Bergvall as his central midfield options.
As a result, Cardoso may struggle to find a regular starting spot in Postecoglou's lineup, but he could add valuable strength in depth should Tottenham decide to trigger his release clause.
Cardoso has showcased his talents with Betis, having been afforded regular game time by experienced manager Manuel Pellegrini.
The 23-year-old has started each of Betis' last five La Liga matches, taking his total appearances for the season to 15 in all competitions.
The Betis midfielder is currently playing under former Tottenham boss Mauricio Pochettino for the USA national side.
Cardoso came off the bench to make his 18th international appearance in Thursday's 2-1 win over Jamaica in the first leg of the CONCACAF Nations League quarter-final tie.