Sana'a has reportedly reached an agreement with the northern Shia resistance fighters, known as Houthis, to put an end to a long running government offensive that left many innocent civilians killed or wounded in the country's mountainous regions.
"The ceasefire is going to be in effect at 12 midnight local time (2100 GMT)," Reuters quoted a Yemeni official as saying on condition of anonymity.
The Yemeni government and Houthi fighters had been involved in exchanging proposals in recent days to settle the conflict.
The conflict in northern Yemen began in 2004 between Sana'a and Houthi fighters. The conflict intensified in August 2009 when the Yemeni army launched Operation Scorched Earth in an attempt to crush the fighters in the northern province of Sa'ada.
Saudi forces began fighting with Houthis and bombing their positions on November 4 after accusing the fighters of killing Saudi border guards.
Houthi fighters say that Saudi forces strike Yemeni villages and indiscriminately target civilians. According to the fighters, Saudis use toxic materials, including white phosphorus bombs indiscriminately in northern Yemen.
The US military also has been involved in bombing Yemen's northern conflict regions of Amran, Hajjah and Sa'ada, according to Houthi fighters.
The UN High Commissioner for Refugees estimates that since 2004, up to 175,000 people have been forced to leave their homes in Sa'ada and take refuge at overcrowded camps set up by the United Nations.