The expansion would help Tesla test the appeal of its renewable-energy products to a wider audience. It would help Home Depot use some of its excess floor space to sell new products and gain a competitive edge over its peers.
Bloomberg first reported on the news on Thursday.
Tesla is adding its own selling spaces at 800 of Home Depot's stores across the U.S., the person told CNBC, to sell residential solar panels and Powerwall (batteries) to begin with. Those areas are scheduled to be built in the first half of 2018, and Tesla employees will man them.
Meanwhile, Lowe's has also held talks with Tesla about selling solar products, Bloomberg reported, based on conversations with familiar sources.
A representative from Lowe's told CNBC: "We don't have any plans to carry the products at this time."
This move would represent a return to Home Depot for Tesla, in one sense. SolarCity, which Tesla acquired in 2016, used to sell its systems via Home Depot stores. Tesla discarded the SolarCity name post-acquisition and now sells its solar products under the Tesla energy banner.