"RCD Mallorca have come to an agreement in principle with Gregorio Manzano for him to take charge of the first team," Mallorca said in a statement.
Manzano would be presented to the media at the club's Iberostar stadium later on Tuesday, they added.
The bespectacled 56-year-old, known as 'the professor', was in charge at Mallorca when they won the King's Cup for the first and only time in 2003 and has agreed a contract until the end of next season, the Balearic Islanders said on Tuesday.
He will make his debut on Saturday in a La Liga game at home to Osasuna and told a news conference he was aware of the difficulties facing the club as they battle to avoid relegation.
"I know the place and part of the squad, I know the challenge," Manzano said.
"We have a commitment to save the team and after that to continue for one more year."
Mallorca dismissed Caparros after a poor run left them one place from bottom with just over half the season played.
They made a strong start to their campaign, winning three and drawing two of their opening five matches, but their form has since dipped and Sunday's 3-0 defeat at Real Sociedad was the final straw for the club's board.
Manzano has also had spells at clubs including Sevilla, Malaga, Real Valladolid, Racing Santander and, most recently, Atletico Madrid.