The deal will be finalized Friday pending a physical, the source said. Contract details weren't immediately available.
Washington, 29, played the past two seasons in New England primarily on special teams. He appeared in 10 games last season, catching one pass for three yards.
Washington will have the chance for a larger role offensively in Baltimore, where depth is thin and starter Derrick Mason is coming off shoulder surgery. Washington worked out with the Ravens on a tryout basis last weekend during a minicamp along with fellow veteran free-agent wideouts Jerry Porter and Tab Perry.
A standout at the University of Tennessee, Washington was a fourth-round pick of the Cincinnati Bengals in 2003. He caught 72 passes for 893 yards and nine touchdowns in four seasons with the Bengals.