The Quartet of Middle East peace brokers - the United States, Russia, the United Nations and the European Union - suspended direct aid to the PA after the election of Hamas.
Quartet members have said they would not restart direct aid until the unity government fully met their demands to recognize Israel, renounce violence and accept existing interim Israeli-Palestinian peace agreements.
But the formation earlier this year of a unity government with the more moderate Fatah faction has led to calls for the resumption of direct aid, most recently on Wednesday from members of the European Parliament's Socialist Group.
According to the Yomiuri report, Japan will send Foreign Ministry officials to talks with Palestinian Authority officials on concrete uses of official development assistance [ODA] sometime next month.
It added the aid was most likely to be awarded to projects and areas under the authority of non-Hamas cabinet members.
Japan's last direct aid to the PA was some $500,000 in December 2005, but it has since provided aid through international agencies and non-governmental organizations, a Japanese Foreign Ministry official said.
A Foreign Ministry official quoted by the Yomiuri said aid to the Hamas government was suspended out of fear that it could be used in militant activities, but the Yomiuri said the foundation of the unity government could open the way to resume aid.
But a Foreign Ministry official told Reuters nothing had been decided and that aid had been suspended since 2005 mainly due to poor security conditions that made it hard to carry out projects.
Japan has been a substantial aid donor to the Palestinians through the years, disbursing roughly $900 million through various routes from 1993 to the end of March this year.
Last summer, then-prime minister Junichiro Koizumi pledged nearly $30 million through international agencies to help keep basic services functioning in the PA.