The long-standing Mayor, who was elected for a third term in May, is expected to receive the gong for his political and public service, having previously served as the MP for Tooting before he left the Commons in 2016.
Mr Khan is one of a number of Labour veterans expected to receive top honours - including Islington South MP Emily Thornberry, the Financial Times writes.
Ms Thornberry is set to receive a damehood despite being dropped from Sir Keir Starmer’s front bench when Labour entered government in the summer. Another recipient is set to be New Labour-era health secretary Patricia Hewitt.
Andy Street, the former West Midlands mayor who was defeated in the local elections in May, when Mr Khan won a historic third term, is one of several Conservative politicians who may receive a knighthood.
A source stressed to the FT that a draft document of honours had yet to receive final sign-off from the Prime Minister or King Charles.
The newspaper reports that the government is positioned to issue a fresh list of political peerages in the coming wees, which are likely to coincide with the New Year honours.
