Queiroz, who previously coached South Africa and Real Madrid, arrived in Tehran early on Monday for final talks with the Iranian Football Federation (IFF), Fars reported.
After a meeting with the head of the Physical Education Organisation, Ali Saeedlou, Queiroz reached an agreement with the IFF to lead the team through the 2014 World Cup, it added.
Queiroz looked to have reached an agreement in February to coach the side, even appointing his assistants, but turned the post down reportedly because his family were reluctant to live in Iran.
The website of state English news network Press TV said in a separate report Queiroz would receive an annual salary of about $2 million.
Iran have slipped down the pecking order in Asian football behind heavyweights Japan, South Korea and Australia, with many blaming the country’s sports authorities for the slide.
Iran missed the 2010 World Cup in South Africa and were knocked out of the 2011 Asian Cup in the quarter-finals by South Korea in January.
