The 33-year old is understood to have told Watford he is leaving and is expected to complete a free transfer switch to Ninian Park this week.
Cox, can play centre-back as well as full-back and has negotiated a release from the final year of his contract and will join Cardiff subject to a medical to fill part of the gaping hole in the Bluebirds' defence following the departure of Danny Gabbidon, James Collins, Robert Page and Tony Vidmar.
Elsewhere, Dutch Under-21 international Glenn Loovens, is understood to have agreed a season-long loan with Cardiff.
The signing of two central defenders could end the Bluebirds' interest in Bristol City's Danny Coles, who they ahve already bid for, which was turned down by Bristol City.
Defence is the most crucial area for Dave Jones and he will be pleased to have finally added to his skeletal squad, although he is still looking for at least another midfielder and striker.