Cheryl (29) flew to Los Angeles yesterday and is understood to have met with Cowell for talks.
The move comes following months of silence between the pair after they fell out last year after Cowell dumped the Geordie singer from the US X Factor.
Although the pair have remained in touch, they are nowhere near as close as they once were.
Cowell is now desperate to get Cole back on to the UK X Factor as ratings have plummeted.
Despite brushing off his attempts at a UK comeback, Cheryl has finally succumbed after Cowell reportedly told the Geordie singer to "name your price".
Cheryl had secret talks with the record company boss in his LA home as he frantically tried to reinstate her for the flagging UK version of the hit talent show.
And it seems that under-fire British singer Tulisa Contostavlos could be making way on the X Factor panel for Cheryl's return.
Cowell is said to be less than impressed with the emergence of a sex tape plus several unsuitable boyfriends and feels Tulisa's controversial publicity has been negative for the show.
Cheryl and Simon (53) famously fell out last year after he axed her from the US X Factor just weeks into filming for the first series.
To add insult to injury, Cheryl -- who recently reunited with her Girls Aloud bandmates -- was replaced by former Pussycat Doll Nicole Scherzinger.
While Cheryl said she would never go back, she briefly returned this year to help Gary Barlow choose his acts at the Judges Homes stage of the competition.
It now seems that she could be the answer to Simon's prayers as he attempts to put an end to the plummeting viewing figures for the show.
One Saturday night live show this series saw ratings fall to just 7.6 million.
This was a stark contrast to the 19.4 million fans that tuned in to watch Cheryl and Simon in the 2010 final.
A source close to Simon last night said: "He's desperate to get Cheryl back on X Factor UK because it's lost its way. The money on the table would be a fortune -- at least double what she got last time. She could have what she wanted."
Simon's spokesman Max Clifford also admitted that Simon still holds a soft spot for Cheryl despite their public rift. Clifford said that he "thinks a lot of Cheryl", sparking rumours about her comeback.
Cowell cannot make a return to the show himself because of his commitment to the US X Factor, but sees Cheryl as the next best thing, according to sources.