The film is to be directed by Steven Soderbergh and will be set in 1920s America rather than ancient Egypt, says The Hollywood Reporter.
X-Men star Hugh Jackman is also said to be in talks to also take a lead role.
Zeta Jones is no stranger to musical film, having won an Oscar for her role as Velma in 2002's Chicago.
Cleo, as the film project is currently entitled, would be Soderbergh's first attempt at directing a musical.
Oh, that one is all kinds of interesting but maybe also someone's idea of a prank. Zeta-Jones is yet another of the royal Hollywood Hathors, along with C/Kates Blanchett, Winslet, Beckinsale, Capshaw, Hudson and Holmes.
A former British Army interpreter who is accused of spying for Iran was a Cuban black magic priest, he has told the Old Bailey.
Daniel James, who worked for Britain's top general in Afghanistan, General David Richards, said he carried out black magic against the Taleban. Mr James also said he was chosen by presenter Jonathan Ross to salsa dance on a television programme. He denies misconduct in public office and two Official Secrets Act charges.Some stories are just so damn stupid they have to be a conspiracy.