"Talaat Sadat will present his candidacy to become president of the republic," spokesman Mohsen Eid said, adding that he planned to make a formal announcement on Thursday at a monument in Cairo marking the site where his uncle was assassinated.
Sadat's manifesto will be based on the same principles as his uncle's, "the hero of war and peace" according to a statement from his office.
Talaat, in his 50s, is a member of parliament with the small opposition party Al-Ahrar (The Free).
Anwar Sadat, hailed by the West but reviled in the Arab world for signing a peace treaty with Israel in 1979, was assassinated during a military parade in October 1981.
Abud al-Zumur, the former leader of the Islamist Jihad movement, was jailed for his role in Sadat's killing and remains in detention despite having served his sentence.
He is among a number of Egyptians to throw their hat into the ring for the country's first contested presidential election, including feminist activist Nawal Saadawi and prominent opposition party leader Ayman Nour.
Egypt has been ruled since 1981 by President Hosni Mubarak under a state of emergency imposed after the assassination. He has not announced whether he will run for another term.
Egyptians voted in a referendum last month to support plans for what the government - under pressure at home and abroad to adopt political reforms - says will be the first multi-candidate elections.
Those wanting to run must submit their candidacies from 18 July.