Avatar is on course to become the highest grossing film of all time, making $1.14bn (£700m) since its release less than three weeks ago.
The Hollywood Reporter said James Cameron's film had overtaken the $1.12bn (£699m) taken by The Lord of the Rings: The Return of the King.
But Cameron still has a way to go to top Titanic's $1.84bn (£1.14bn).
It is thought that Avatar's huge box office takings are partly due to the higher cost of 3D film tickets.
Titanic, which starred Kate Winslet and Leonardo DiCaprio and won the best director Oscar for Cameron, made a new box office record during its release from 1997-1998.
Most expensive
Earlier this month, Avatar became the fastest movie ever to achieve $1bn (£623m) in ticket sales around the world.
Distributors 20th Century Fox said it had earned more than $350m (£218m) in the US and more than $670m (£417m) across the rest of the world in only 17 days.
The sci-fi epic, about a disabled marine who infiltrates a race of giant blue aliens, mixes live action with digitally-created performances.
It was reportedly the most expensive film ever made, with a budget of at least $300m (£187m).
In December, Cameron said the movie could be the first part of a trilogy.
"I feel like I have to make a second one now, but that'll only happen if we make some money with the first one.
"I have a story worked out for the second film, and the third film, but my lips are sealed," he said.
Meanwhile, it has also been reported that Cameron has set his sights on another project.
According to film magazine Empire, the director has bought the rights to Charles Pellegrino's soon-to-be published The Last Train From Hiroshima: The Survivors Look Back.
The book chronicles two days during and after the atomic bomb drops at the end of the Second World War, using eyewitness accounts from Japanese civilians and American pilots who survived the experience.
Source: BBC
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