In a report on Saturday, The Washington Post cited unnamed US and UN officials who claimed an entirely new Iraqi government would be picked to assume power on 30 June.
The latest shift in policy comes as the US-led occupation administration faces some contentious and long-standing issues ahead of the power transfer.
The Post said at the top of the list of those probably to be jettisoned was Ahmad Chalabi, a Shia politician who for years was a Pentagon favourite and popular with Vice President Richard Cheney.
Fall from favour?
Chalabi has increasingly alienated his paymasters in the Bush administration, including the president.
He generated anger in Washington on Friday by condemning a new US plan to allow some former officials of the Baath Party and military to return to office.
With little respect in Iraq, IGC
could be easily replaced
Chalabi equated the move with returning Nazis to power in Germany after the Second World War, according to the paper.
A convicted fraudster, Chalabi has headed the committee in charge of removing former Baathist officials.
Pulling plug on funds
In a nationwide address, chief US occupation administrator Paul Bremer said complaints that the programme was "unevenly and unjustly" administered were "legitimate".
Washington is also seriously considering cutting off the $340,000 monthly stipend to Chalabi's party, the Iraqi National Congress, the paper said, quoting a senior administration official.
The INC has received millions of dollars in US aid over the past decade.