The Crown Office yesterday confirmed it had written to the families of all 270 victims of the 1989 bombing to spell out how any transfer would take place.
Insiders said the move amounted to an acknowledgement that Abdelbaset Ali Mohmed al Megrahi will be sent home after a controversial prisoner transfer agreement is ratified at the end of this month.
Megrahi, who is suffering from incurable cancer, is currently serving 27 years in Greenock Prison but is awaiting an appeal against his conviction. The letter to families, which was sent by e-mail, is understood to suggest that the 2007 agreement between Libya and the UK will be ratified on April 27, the day before Megrahi's long-awaited appeal is due to begin in Edinburgh.
Megrahi is the only Libyan national currently serving a jail sentence in Scotland and is understood to be eager to return home to end his life close to his wife Aisha and children.
A spokeswoman for the Crown Office declined to reveal the details of the letter but stressed that prosecutors had been keeping families up to date with the case.
She said: "Since the day the UK signed the agreement in 2007 we have communicated with the families about it because of their long-standing interest in any prisoner transfer arrangements between the UK and Libya."
The former Libyan security service officer was granted the right to take his case back to the Court of Appeal for a second time after the Scottish Criminal Case Review Commission found that his conviction "may be a miscarriage of justice". Late last year he asked to be released on bail pending the plea but was refused.
Megrahi's relatives believe that he would not survive the appeal, which is expected to take as long as a year, partly because the court will not sit full time. His prostate cancer, as revealed in Scotland on Sunday, has spread to other parts of his body.
Some reports have suggested that officials in both England and Scotland have encouraged Libya to apply for Megrahi to be transferred as soon as the agreement is set in stone.
Last month it was claimed that Robert Gordon, the most senior civil servant in the Scottish Government's Justice Department, had been instructed by Kenny MacAskill, the Justice Secretary, to hold talks with the Libyans. In theory, however, the agreement on prisoner transfer is between Libya and the UK.
Talks on prisoner transfers between the two countries started in 2005 but the foreign office has always denied that the negotiations have anything to do with Megrahi specifically.
MPs on Westminster's Committee on Human Rights last month said they felt the treaty raised concerns and asked for ratification to be delayed until the end of this month.
The committee, which wants to carry out a full investigation of the draft treaty, said: "In our view, when a select committee states that it intends to scrutinise a treaty, ratification should be delayed until the committee's inquiry has concluded."
First Minister Alex Salmond has previously said he feels Megrahi should serve his entire term in Scotland. The initial prisoner transfer agreement, dubbed "the deal in the desert", sparked fury north of the border.
Even after the deal is finalised, it will be up to MacAskill to decide whether to release Megrahi to the Libyans. The UK Government has no power over prisoners in the Scottish system.