The source, who spoke on condition of anonymity because President Jose Mujica has not yet decreed the new regulations, said the government will auction up to six licenses to produce cannabis legally.
Mujica is expected to sign off on the rules in coming days. He proposed the landmark legalization law to undermine drug trafficking.
Uruguay, the first country to legalize the growing and sale of marijuana, is being closely watched by other countries debating drug liberalization.
Cannabis consumers will have to register with the government on a confidential list before making purchases from authorized pharmacies, according to the law passed by Congress in December.
The pharmacies can only be supplied by private growers authorized by the government, which will oversee quality and choose varieties. Individuals will also be able to grow up to six plants for personal use.
Uruguay has said it is also considering having marijuana grown on a plot of land controlled by the military to avoid illegal trafficking of the crop.
Ten to 20 hectares of marijuana would likely be enough to meet domestic demand, according to preliminary estimates.
Authorities have suggested setting the price for marijuana at $1 per ounce to compete with Paraguayan cannabis that has flooded the black market.
About 20,000 of the 3.3 million people who live in Uruguay are estimated to use marijuana every day.
The majority of Uruguayans oppose the new law, but do not want it repealed until its impacts can be assessed, according to a poll by the consulting firm Cifra published on Thursday.
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I think its a good move . At least it will reduce ( if not totally stop ) the contraband market .