The source, who is familiar with Lohan's criminal case but was not authorized to comment publicly, said the actress wants to put the case behind her so she can focus on her career.
No court date has been set for Lohan to enter the plea. She is scheduled to return to a Los Angeles court for a pretrial hearing May 11, but the actress is hoping to resolve the case before then, the source said.
By pleading no contest, Lohan would not be admitting guilt, and it was not immediately clear if she would face any additional penalties. The actress already has been sentenced to four months in jail for a probation violation related to the theft case. She is free on bail.
Prosecutors in February charged Lohan with felony grand theft on allegations that she took the necklace from Kamofie & Co., a jewelry store near the actress's home in Los Angeles' Venice neighborhood. The charge was reduced last week by Los Angeles Superior Court Judge Stephanie Sautner.
Authorities allege the theft occurred roughly three weeks after Lohan, 24, was released from court-ordered rehab at the Betty Ford Center.
Lohan's assistant turned the necklace in to authorities after police obtained a search warrant to retrieve it from Lohan's house, but before detectives were able to conduct the search.
Sautner said during an April 22 hearing that she thought Lohan's actions were brazen, but that she did not think the case warranted a felony prosecution because many other cases involving more serious allegations are reduced to misdemeanors.
Deputy District Attorney Danette Meyers said she thought the ruling was an "abuse of discretion" and her office may appeal it, but no challenge has yet been filed.
A little over a week ago, Sautner sentenced Lohan to 120 days in jail and nearly 500 hours of community service for violating the terms of her probation by taking the necklace. Lohan was on probation for a 2007 drunken driving case.
She was released to pursue an appeal but has not yet filed a formal motion to try to get the sentence reduced.
In all likelihood, Lohan would serve a small fraction of her four-month sentence — possibly as little as three weeks — due to jail overcrowding.
The source said Lohan's intention to plead no contest was aimed at making good on her statement to Jay Leno earlier this week that she wanted to take responsibility for her actions.
The plea was first reported Saturday by celebrity website TMZ.
The actress's career has been mostly stalled for the past year as she struggled to deal with the terms of her sentence in the drunken driving case. She recently accepted a two-picture deal to appear in a pair of mob films, including a biopic of the infamous Gotti family. She will portray the wife of John Gotti Jr. in the film "Gotti: Three Generations" that also stars John Travolta and Joe Pesci.
In a recent interview with The Associated Press, Lohan said she hopes the role will help her return to being known more as an actress than a tabloid mainstay.
"I'm really excited to be back on set and clear up all the misinterpretations about me and show this is what I love to do," Lohan said about her new roles.
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