Sources within the Finnish smartphone maker speaking to The Verge have said that the new smartphone is codenamed Bandit.
They added that it will come with a six-inch display, a quad-core Snapdragon processor and a 20 megapixel camera.
Read more: Best tablets to buy in 2013
They followed reports that Microsoft will remove limitations on Windows Phone 8 that had meant 1080p displays and quad-core processors were not supported.
According to those previous rumours, Nokia is planning to unveil the Bandit as early as September 26th.
Read more: Best Windows Phone apps ever
Speaking to the Verge, the sources said that the device will be thin and light due it using a polycarbonate body. It will also likely to come with a slight bump to accommodate the 20 megapixel rear camera, similar to the 925.
The phone is reportedly being tested in the US now. That fits in with a late September unveil.
The news comes just one day after pictures emerged of a full size tablet Nokia is reportedly working on.
Read more: Nokia Lumia 1020 review
Previous rumours had suggested that Nokia will be unveiling both the Bandit and the tablet on the same day.
Unlike the Bandit, the tablet is rumoured to run Windows RT.