Apple is set to launch a computerised wristwatch this autumn that includes more than 10 sensors to take health measurements and other data, a report says.
The Wall Street Journal also said that Apple is planning multiple screen sizes for the device, which some people have dubbed the iWatch.
Samsung, Sony, Qualcomm and others have already released smartwatches, but the gadgets have mostly functioned as companions to smartphones, offering things like email notifications and clock functions.
Samsung's Gear 2 line, released this year, added fitness-related apps and has a heart rate sensor.
There has been long-standing speculation that Apple has been working on a smartwatch. The main question has been when it would come out.
Apple intensified speculation this month when it said the upcoming version of its mobile operating system, iOS 8, will include tools for managing health data. The software is expected in September, along with new iPhones.
Apple has been under pressure to release new products as investors question whether the company that popularised the smartphone and the tablet computer is still able to innovate following the death of co-founder Steve Jobs.
Chief executive Tim Cook has hinted at new products coming this year, but the company has not provided details.
The Wall Street Journal said production of the smartwatch is expected to begin in two or three months at Quanta, a Taiwanese company that has worked on Apple's Mac computers. Sales of the device could begin as early as October.