The Wall Street Journal noted on Wednesday that sources among Amazon's parts suppliers report that testing of a smartphone is underway.
"Officials at some of Amazon's parts suppliers, who declined to be named, said the Seattle-based company is testing a smartphone and mass production of the new device may start late this year or early next year," author Lorraine Luk wrote.
Assuming the report is accurate, Amazon appears interested in releasing a phone with a large display, as one tipster claimed the online retailer is currently testing devices with screens between four and five inches.
The Journal's claims come on the heels of a Bloomberg report from last week said Amazon is working with Foxconn to produce a smartphone. The publication also suggested that Amazon is looking to buy up wireless-related patents in order to protect itself from intellectual property threats.
Hints of an Amazon-developed handset first emerged late last year. Citigroup analyst Mark Mahaney told investors last November that channel checks with the Asian supply chain.
Amazon is expected to pose a credible alternative to Samsung and Apple, the current smartphone market leaders. It has been suggested that Amazon is likely to follow the same model it put forth with the Kindle Fire and fork the Android OS in order to better integrate it with its own products and services.