The deal is expected to be worth around £2.5m to Villa, who will now step up their pursuit of Newcastle winger James Milner.
Maloney was somewhat a fans favourite at Villa Park with his creative spark often impressing the home faithful.
Unfortunately for the Scot, Ashley Young was in such fine form throughout last season meaning he was unable to play in his natural role.
Celtic will welcome back their former player with open arms after making no secret of their desire to resign him during the second half of last season.
Maloney will have to prove himself once again, but after a troubled time in England he will be pleased to return to the club where he made his name.
As for Villa, a £9m offer for Milner is being prepared and Martin O'Neill is hoping to complete a deal, which would be the last piece in his summer signings jigsaw.
Milner may see a move back to Villa Park as a way of gaining a regular England place because Fabio Capello is likely to be at the stadium frequently this season.