Venables, the former England coach, had been linked with the Nigeria job after narrowly failing to take Australia into the World Cup finals. Nigeria have been without a coach since the Frenchman Philippe Troussier left in August.
The military government gave its approval to the choice of Milutinovic and the contract was expected to be signed later in the capital, Abuja, according to the Nigeria Football Association's spokesman, Sani Zaria.
In secret negotiations last week, Nigerian FA members were said to have favoured the Dutch coach, Jo Bonfrere, but they feared Nigeria's authoritarian ruler, General Sani Abacha, would not accept him. Bonfrere coached Nigeria to their victory in the 1996 Olympic Games in Atlanta, but then resigned shortly afterwards in what was seen as an insult to Abacha.
Milutinovic, who will be Nigeria's fourth coach in 20 months, was dismissed as coach of Mexico in November, less than a month after helping his team clinch a place in the World Cup finals. He coached Mexico to the quarter- finals in 1986, Costa Rica to the second round in 1990 and the United States to the second round in 1994.
Scotland are trying to arrange two matches against Denmark next March so they can give as many players as possible the chance to impress before the World Cup finals. The first-choice team are due to face the Danes, who have also qualified for France, on 25 March, with Ibrox the likely venue.
But Craig Brown, the Scotland coach, is also anxious to fix up a B team match so he can give his fringe players a run-out. Scotland are due to face Finland in April before probably embarking on a two-match trip to the United States the following month. Then they will settle into their French base in St Remy de Provence as Brown finalises his preparations for the opening match against holders Brazil on June 10.
Sheffield Wednesday's pounds 1.75m move for Goce Sedloski has been put on ice after the Macedonian international failed his medical. It is the second blow for the new Wednesday manager manager, Ron Atkinson, in the space of 24 hours after he learnt the 23-year-old central defender from the Croatian club Hadjuk Split faces a delay in obtaining a work permit.
Atkinson refused to reveal the nature or the extent of the problem, but said: "The X-rays have shown up something which could later give him some trouble." Atkinson is determined to finalise the transfer, but added: "We will now have to renegotiate and restructure the deal because we want to safeguard our interests."
Chelsea are leading the chase to sign China's captain, Fan Zhiyi, according to reports in the Far East. A leading Chinese newspaper says that the London club want the country's 1996 player of the year, while several English clubs are keen to sign other internationals.
Arsenal, Southampton, Crystal Palace and Nottingham Forest have been linked with the striker Hao Haidong, who plays for the present Chinese champions, Dalian Wanda, and was prevented from joining the Uruguayan side Penarol in 1995.
Wang Jungsheng, the vice president of the Chinese Football Association, said: "We have not yet received letters from the interested clubs nor invitations to the players." He also refused to discuss transfer fees, saying it was a "very sensitive question", but reports say the first transfer of a Chinese player to England could happen as early as next month.
The Croatia Zagreb striker Igor Cvitanovic has signed for Spanish side Real Sociedad for pounds 2m. Cvitanovic has been his country's top scorer for the last two seasons.
Second Division Bournemouth are taking two Manchester players on loan. City's former Southampton and England Under-21 winger Neil Heaney is to spend a month at Dean Court, along with United's 19-year-old midfielder Paul Teather.