The White House and Department of Justice declined to comment, but a source familiar with the development confirmed it.
The Associated Press first reported the development.
If enacted, the measure wouldn't legalize marijuana. Rescheduling marijuana is distinct from descheduling it entirely, which some advocacy groups and lawmakers have called for, as it could still lead to legal action against those found to be in possession of it in states where the drug is not legal.
This decision could also give President Biden a boost among younger voters. Celinda Lake, a Democratic pollster and strategist who serves as president of Lake Research Partners, previously told The Hill that action on marijuana scheduling would signal that Biden is a "modern president."
Public opinion leans strongly in favor of marijuana legalization, with a Gallup poll from November finding that a record 70 percent said they were in favor of it. A group of Democratic senators issued a letter to the DEA last week calling for marijuana to be descheduled entirely.
Marijuana has been listed as a Schedule I drug for more than 50 years, meaning it has a high potential for abuse and no accepted medical use.
Schedule III drugs are considered to have a "moderate to low potential for physical and psychological dependence." Substances within this category include ketamine, anabolic steroids and testosterone.
Rep. Earl Blumenauer (D-Ore.), founder and co-chair of the Congressional Cannabis Caucus, said the move would bring the U.S. one step closer to ending the "failed war on drugs."
"Marijuana was scheduled more than 50 years ago based on stigma, not science. The American people have made clear in state after state that cannabis legalization is inevitable," Blumenauer said. "The Biden-Harris Administration is listening."
