The paper said the deal, which is seen as a dump of Vujacic's nearly $5.5 million salary, is conditional upon the 35-year-old Smith passing a physical.
It also involves the Nets trading forward Terrence Williams to the Rockets, a deal the Houston Chronicle reported would give New Jersey a 2012 first-round draft pick.
Smith and Williams were both kept out of Tuesday's game against Philadelphia, while Vujacic was kept from the Lakers' game in Washington.
Williams tweeted Tuesday a thank you to New Jersey fans while adding, "go Rockets."
Read more about the deal at LAtimes.com