Four EU diplomats say a political agreement has been reached on the sanctions and that a foreign ministers' meeting in Luxembourg next Monday will officialise them.
EU countries have agreed on sanctioning Iran following its brutal crackdown on protests over Mahsa Amini's death, diplomats have said, as demonstrations continue to rock the country.
Four EU diplomats told AFP news agency that a political agreement was reached on Wednesday on the sanctions and that a foreign ministers' meeting to be held in Luxembourg next Monday was to officialise them.
There were no details on the impending sanctions, but the United States, Britain and Canada have already separately targeted security branches of the Iranian government.
The United States and Britain have imposed sanctions on Iran's morality police, who arrested 22-year-old Amini last month for allegedly wearing a hijab headscarf in an improper way.
She was taken unconscious from a police station to hospital where she died. Her family, the protesters in Iran, Western officials and rights groups have all called her death a "killing". Iran denies that and says she died of natural causes related to childhood surgery.
Canada last week said it will permanently deny entry to more than 10,000 members of the Iranian regime, including those belonging to the Revolutionary Guard, which is leading a deadly crackdown in the face of protests.
The latest European sanctions will land at a delicate moment, given that the EU plays a coordinating role in talks aimed at reviving a 2015 deal that curbed Iran's nuclear activities.
Those talks are in an impasse, EU foreign policy chief Josep Borrell has said.
Iran's supreme leader Ayatollah Ali Khamenei on Wednesday again accused Iran's "enemies" of stoking "street riots".
"The actions of the enemy, such as propaganda, trying to influence minds, creating excitement, encouraging and even teaching the manufacture of incendiary devices are now completely clear," he said.
Khamenei has already accused the United States, Israel and their "agents" of stoking the protests.
"Today, everyone confirms the involvement of the enemies in these street riots," he said on Wednesday in a televised meeting with the Expediency Council, an advisory body.
Meanwhile, gunshots were heard again as Iranian security forces confronted protesters in a crackdown that rights groups say has already cost at least 108 lives with many children among the dead.
The chants of protesters were interrupted by the crack of gunfire in the cities of Isfahan and Karaj and in Amini's hometown Saqez, in videos shared by two Norway-based human rights organisations.
"Death to the dictator," shouted female students who had defiantly taken off their mandatory hijab headscarves as they marched down a Tehran street, in a video verified by AFP.
Young women, university students and even schoolgirls are taking off their hijabs and faced off with security forces in the biggest wave of social unrest to grip Iran in almost three years.
At least 28 children have been killed and hundreds more detained and held mostly in adult prisons, rights groups said.
READ MORE: Death toll from Iran protests rises: NGO