The Raiders are expected to designate the move with a post-June 1 designation, according to the source.
After spending his first four seasons with the Los Angeles Rams, Littleton, 28, signed a three-year, $35.25 million free-agent deal with $22 million guaranteed with the Raiders in 2020 and was expected to help in sideline-to-sideline pass coverage. Instead, he lost his starting job to rookie Divine Deablo late last season.
The post-June 1 designation will save Las Vegas $11.75 million against the cap after that date but will cost the Raiders $4 million in dead money this year and $10 million in 2023.
Earlier Thursday, the Raiders restructured the contracts of foundation left tackle Kolton Miller and versatile running back Kenyan Drake to save $14.525 million in cap space. They also informed fullback Alec Ingold they were not tendering his contract.
Littleton started 27 of 31 games for the Raiders and had just 0.5 sacks and a fumble recovery. He did not have an interception among his four passes defended. He also had six tackles for a loss among his combined 180 tackles.
The Raiders have a new regime with general manager Dave Ziegler and coach Josh McDaniels, who came over from the New England Patriots.