Clark still has three years to run on his present deal at The Madejski Stadium but it is believed there is a clause in his contract that allows him to move to a Premiership club.
"Niall is is going to West Ham," Royals boss Steve Coppell told the Reading Evening Post.
"He is sorry to be leaving Reading, but the chance to go to a Premiership club is just too good to turn down. His wife is expecting twins and he’s got to do what’s best for his family.
"We’re sorry to be losing him, but there’s nothing we can do about it."