Derby have granted Chelsea permission to speak to Frank Lampard about the vacant manager's job at Stamford Bridge.
Sky sources understand Chelsea have told Derby they are prepared to pay the £4m compensation clause in Lampard's Rams contract.
The 41-year-old is in line to replace Maurizio Sarri after the Italian returned to his homeland with Juventus.
A Derby statement said: "Derby County Football Club can confirm that they have granted permission for Chelsea Football Club to speak to Frank Lampard about the vacant managerial position at Stamford Bridge.
"With pre-season fast approaching for both clubs, it is hoped this will allow Chelsea to swiftly conclude their discussions.
"The club will make no further comment until it is appropriate to do so."
Lampard was appointed as Derby boss last summer and enjoyed an impressive debut season in management, leading the club to the Sky Bet Championship play-off final where they lost 2-1 to Aston Villa.
He spent 13 years in west London as a player, winning three Premier League titles, four FA Cups, two League Cups, the Europa League, and Champions League, becoming the club's all-time top goalscorer in the process.
Analysis: Why Lampard - and what now for Derby
Sky Sports News reporter Rob Dorsett:
"There's no surprise here - we've reported in the last few weeks that we expected Frank Lampard to be approached and that we thought he would accept.
"The only surprise perhaps is that it's taken Chelsea so long to do it; Maurizio Sarri left nine days ago and it's only on Tuesday that Chelsea have made that first approach. I would expect things to move pretty quickly from here - certainly before the end of this week, Lampard is expected to be in post as the new Chelsea manager.
"What happens next? Well, Lampard and his representatives will be free to meet with Marina Granovskaia to discuss personal terms and details of his contract - including who he would want as his backroom staff.
"This might be another blow to Derby because my understanding is that he would want to take his current assistant, Jody Morris, with him. Morris is well known to Chelsea as he was involved in their academy for a long time.
"It's a difficult one for Derby to stomach but they've expected it for a long time - it was made clear to me that they wouldn't stand in Lampard's way if Chelsea came calling. They know it would be almost impossible for him to turn down and are grateful for the work he's done.
"But we should not forget how extraordinary this story is - Lampard has been a manager for 57 games in total and now he's going to take one of the biggest jobs in English football.
"There is no real rush to get him on board though - that's why Chelsea have waited to make a formal approach - because Chelsea are working under a transfer ban imposed on them by FIFA for the next two transfer windows.
"That's my understanding as to why Lampard is so appealing to Chelsea - he knows the youngsters well and will give them opportunities to play. It will be music to the ears of the likes of Callum Hudson-Odoi, when he returns from injury. I'll think you'll see a new-look, youthful Chelsea.
"What about Derby? My understanding is that they've have not done any prep to replace Lampard yet - they wanted to keep him and wanted to make sure he knew that. Despite financial limitations, it's an attractive job.
"My gut feeling is that they will stick with young, up and coming managers. Steven Gerrard is exactly that - but he's made it clear to us at Sky Sports News that he's happy at Rangers. Derby will want a new manager in pretty quickly, though."