Hayek was chosen by French President Nicolas Sarkozy to receive the honor and will be given the medal -- the highest in the Legion of Honour -- sometime in the next two months at the Elysee Palace in Paris, a source told People magazine.
The tradition was established by Napoleon Bonaparte in 1802 to honor outstanding military and civilian conduct.
Joining Hayek will be Francois Pinault, her wealthy tycoon father-in-law, who has also been awarded the same honor.
British newspaper The (London) Daily Telegraph reported that some in France have accused Sarkozy of using the awards as a political move in advance of presidential elections. The tabloid also pointed out that Hayek's husband, Francois-Henri Pinault, is close friends with Sarkozy.
Former French Budget minister Henri Torre was also nominated, but he refused to accept the honor because "too many people were nominated who do not deserve to be honored," Torre told the French magazine Marianne.