The film, titled 'The Secret Life of Houdini: The Making of America's First Superhero', will be directed by Dean Parisot.
Christi Dembrowski, Depp's producing partner at Infinitum Nihil, is in negotiations to produce the the film, said The Hollywood Reporter.
The story reportedly recasts Houdini as an investigator of the world of the occult.
The screenplay was written by Noah Oppenheim, based on William Kalush and Larry Sloman's book of the same name.
Depp, considered one of the biggest stars in Hollywood, recently suffered big budget box office disappointments including 'Transcendence' and 'The Lone Ranger'.
Lionsgate is eyeing a November 2014 start for Houdini, which would push Pirates' production to early 2015.