HITC Sport understands that the experienced centre-half is to link up with the Championship new boys following his release by Leicester City.
The 36-year-old joined the Foxes last summer, penning a one-year contract.
Injury struggles over the first half of the Premier League season prevented him from making the desired impact and he was allowed to move on after making just six appearances in all competitions.
Championship new boys MK Dons are in the market for proven performers, though, and a move for Upson has been mooted for some time.
Karl Robinson is aware of the need to bolster his ranks as he prepares to lead his side in the second tier for the first time in their history – and has already landed Southampton striker Sam Gallagher on loan today, as announced on the club’s official website.
Upson would bring a wealth of top-flight and international knowhow with him to Milton Keynes, having previously spent time on the books of Arsenal, Birmingham City, West Ham United and Stoke City, while earning 21 caps with England.
He has also graced the Championship in the recent past with Brighton & Hove Albion, so knows what to expect from the division.