The 47-year-old Powell, currently in charge of Championship neighbours Featherstone, has emerged from an all-British shortlist as the successor to Australian Ian Millward, Press Association Sport understands.
Powell, who has agreed a two-and-a-half-year contract with the Tigers, told the Featherstone players of his impending move on Saturday and will be confirmed in his new job after the Bank Holiday.
Castleford chief executive Steve Gill made it clear he favoured a British coach and rejected an offer from the club's Australian former boss Stuart Raper to return to assist caretaker coach Danny Orr until a permanent appointment is made.
Orr, the club's former captain who only joined the backroom staff after retiring as a player at the end of last season, has been in charge since Millward was sacked 11 matches into his second season, with the Tigers bottom of Super League, but has readily admitted he is not yet ready for the job.
Orr will stay on to assist the Castleford-born Powell, who is thought to have landed the post when Leeds assistant James Lowes turned it down while Kieron Purtill, assistant at Huddersfield, was also in contention.
The former Sheffield Eagles, Keighley and Leeds stand-off, who won 33 caps with Great Britain, has coached in Super League in the past. He was promoted to head coach of Leeds in April 2001 as the successor to Australian Dean Lance but made way for the appointment of Tony Smith two years later.
Powell went on to coach the Rhinos' sister rugby union club, Leeds Tykes, before joining Featherstone in 2008 and has also managed Ireland and worked as an assistant to England head coach Steve McNamara.
During his four seasons with Rovers, he has won the League Leaders' Shield for the last three years and guided them to the Championship Grand Final in 2011.
Last season, he notably guided Rovers to a 23-16 Challenge Cup victory over Castleford.
- Sports & Recreation