Spokespeople for Alphabet and Lyft declined to confirm the report.
The funding could come from either Google itself or CapitalG, Alphabet's private equity arm, according to Bloomberg. And although a deal could still fall through, the timing suggests that Lyft is capitalizing on Uber's recent stumbles, taking the opportunity to grow its war chest while its better-funded competitor is busy licking its wounds.
Uber appointed a new chief executive, former Expedia CEO Dara Khosrowshahi, in late August after a string of scandals.
Lyft has to date raised more than $2 billion in venture capital funding from sources such as General Motors, Andreessen Horowitz, Mayfield, Floodgate and activist investor Carl Icahn.
Uber, in comparison, has raised more than $15 billion from Benchmark, Fidelity, Saudi Arabia's Public Investment Fund and GV, formerly known as Google Ventures. It remains the dominant player in the on-demand transportation industry.
An investment in Lyft could further complicate the already strained relationship between Alphabet and Uber. Despite Alphabet's past investment in Uber, its self-driving car unit, Waymo, is currently suing the ride-hailing service, alleging use of trade secrets.
Softbank, a Japanese telecommunications company, is reportedly in talks to invest in Uber, but Axios reports that it has threatened to invest in Lyft unless Uber meets its terms.