The source said Holloway was granted a waiver of the NCAA's year-in residence requirement for transfers.
Murphy played two years at Ole Miss but sat out last year after transferring to South Carolina. Holloway chose to walk on at South Carolina, which enabled him to pay in-state tuition for the length of his transfer year before becoming eligible for a basketball scholarship in his junior and senior seasons.
The 6-foot-7 Holloway had to leave Ole Miss to go home to South Carolina to help take care of his infant daughter. According to a source, Holloway's situation has stabilized and he no longer is the primary caregiver.
The SEC needs to officially endorse the waiver and transfer. Holloway averaged 10.1 points and 7.6 rebounds during his sophomore season.
Holloway was eligible to practice but now he's eligible for game competition.
Ole Miss will lean heavily on Holloway on the frontline with Terrance Henry and Reginald Buckner. The Rebels are trying to be relevant in a crowded upper tier in the SEC with favorites Kentucky, Vanderbilt and Florida ahead of Alabama and Mississippi State.
Andy Katz is a senior college basketball writer for ESPN.com. Information from ESPN.com's Eamonn Brennan was used in this report.