Lebanese officials offer to exchange the body of an Israeli for the bodies of two Lebanese guerrillas.
The bodies could be handed over at the border point of Naqoura on the Mediterranean Sea coast as early as late Monday afternoon.
Along with the bodies of the two Hezbollah guerrillas, Israel may also return one Lebanese held by Israel, said the official, who spoke on condition of anonymity because of the sensitivity of the issue.
Israeli government officials declined comment on the possibility of a swap. The International Committee of the Red Cross, which has been involved in the past with in such swaps, also declined comment.
Lebanon's opposition includes the militant group Hezbollah, whose capture of two Israeli soldiers during a cross border raid last July sparked a 34-day war between the Shiite Muslim group and Israel. Three other Israeli soldiers were killed in the raid.
But it did not appear that the two kidnapped soldiers were part of the swap, despite a U.N. Security Council resolution demanding that Hezbollah turn over the captured soldiers.
Last year, Israeli officials for the first time raised the possibility that the two soldiers held by Hezbollah might not have survived the initial attack. Military officials then said one of the soldiers was critically wounded and the other seriously wounded when they were captured, without giving further details.
The Lebanese official said the Israeli who would be swapped Monday "died of a cause unrelated to last year's aggression."
New TV, a local Beirut station, reported that the bodies of two Lebanese would be exchanged for the body of an Israeli who had drowned in the Mediterranean and his body was swept by currents north. It did not elaborate.
The families of two longtime Lebanese prisoners also confirmed that the swap would take place. The families, who asked that their names be withheld also because of the sensitivity of the issue, said they knew the information because the militant group Hezbollah contacted them to let them know that their relatives would not be part of the swap.
Hezbollah's satellite TV station, Al-Manar, carried a news report about a possible swap and said Hezbollah officials refused to comment. But the station did not deny that the swap would take place.