But the limited sign-and-trade options available to Orlando -- Barnes' last team -- could scuttle the deal, according to sources close to the situation.
Under the impression that he would be receiving a two-year contract in the $10 million range, Barnes thanked Magic fans via his Twitter feed and said that he'll be "playing for the Toronto Raptors" next season.
Sources told ESPN.com that the teams will resume discussions Tuesday, as planned all along, with the intent of landing Barnes with the Raptors via sign-and-trade.
Yet no such deal could be assured as of midnight, raising the possibility that Barnes would have to accept new terms to sign with the Raptors or that other teams that have been chasing Barnes will get another shot at him if the deal collapses.
Since Toronto recently spent the bulk of its $5.8 million mid-level exception to sign Linas Kleiza, it doesn't have the available funds to sign Barnes outright to a deal that starts in the neighborhood of $4 million.
The Magic, though, are prevented by salary-cap rules from starting a sign-and-trade deal for Barnes at higher than $2 million, because Orlando doesn't have Barnes' full Bird rights after employing him for only one season. A sign-and-trade deal would also have to span at least three years, although only the first year is required to be guaranteed.
Barnes was initially believed to be on the verge of signing with a title contender late last week -- such as Miami, Boston or the Los Angeles Lakers -- when the Raptors made an aggressive late rush to join the bidding.
Barnes also gave serious consideration in recent days to the Cleveland Cavaliers before talks with Toronto got serious.
Barnes started 58 games last year for Orlando in his only season with the Magic after a hard recruiting push from center Dwight Howard.
The 30-year-old averaged 8.8 points and 5.5 rebounds per game in Orlando and had originally signed a two-year deal with the team. But Barnes exercised his option to become a free agent after playing for $1.6 million in 2009-10.
With salary-cap rules limiting the raise the Magic could offer unless it cut into its own mid-level exception, Magic general manager Otis Smith said last week that matching Chicago's offer sheet to sharpshooter J.J. Redick and signing Quentin Richardson were budget priorities.
If Toronto does not become Barnes' eighth stop in a career that began with the Los Angeles Clippers in 2003, it will be the second high-profile deal to unravel unexpectedly at the Raptors' expense this offseason.
Earlier this month, Charlotte agreed to participate in a trade originally hatched by Toronto and the Phoenix Suns, which would have brought Tyson Chandler and Boris Diaw to the Raptors. But the Bobcats pulled out and traded Chandler to Dallas one day later.
Marc Stein is a senior NBA writer for ESPN.com.