An unrestricted free agent, Harpring accepted a new contract offer from the Jazz on Tuesday morning, according to agent Richard Howell.
The four-year, $25 million deal will be finalized July 12, the first day NBA rules allow free agents to sign new contracts.
Howell described Harpring as "satisfied" with the deal, which will likely keep him in Utah through the 2009-10 season.
"The basketball situation in Utah is good," Howell said.
Although the Jazz missed the playoffs for the third straight time last season, they went 17-16 after the return of the injured Carlos Boozer, including 9-4 down the stretch.
Harpring "liked the direction" the Jazz are going under owner Larry Miller, vice president of basketball operations Kevin O'Connor and head coach Jerry Sloan, Howell said
"The last month of the season - when they were all together - they showed they could be a good team," he added.
O'Connor declined comment on Harpring's pending return because team officials are not allowed to discuss free agents until the July 12 signing date.
The 30-year-old Harpring averaged 12.5 points per game last season, his eighth in the NBA and his fourth in Utah.
Despite undergoing two knee surgeries in 2 1/2 years, he has missed only 15 games over the last two seasons.
Harpring, who earned $5.02 million last season, sought a four- or five-year contract. Initially, the Jazz did not want to offer more than a three-year deal, league sources said.
A compromise was obviously reached, however, and Harpring decided to re-sign with the Jazz despite "widespread interest" in him from other teams around the league.
"It was flattering to him," Howell said. "Time-consuming for me, [but] flattering for him."
Phoenix and Denver were known to have pursued Harpring.
"There were a lot of teams out there trying to pull the trigger," Howell said. "Some actually pulled the trigger. Others told us they were planning to pull the trigger."
By re-signing Harpring, the Jazz solidified their shooting guard-small forward position.
Also in the mix - at least at this point - are veterans Andrei Kirilenko, Gordan Giricek and Devin Brown, second-year man C.J. Miles and versatile first-round draft pick Ronnie Brewer.
Among those players, Brown's situation with Utah is probably the most tenuous. He is scheduled to earn $2.6 million this season. But the Jazz - or any team that might acquire him in a trade - can buy him out for $500,000.
With the Harpring negotiations finished, O'Connor now turns his attention to the Jazz's other valuable unrestricted free agent, center Jarron Collins.