The trade action comes as Obama and Republican rival Mitt Romney trade barbs on China, accusing each other of backing policies that would move American jobs overseas.
The president will announce the new case Monday during a campaign trip to Ohio. The swing state has a large manufacturing base where many blame China for depressing its industry.
Obama and Romney have both pushed China — and through it, the economy — to the forefront of the White House race as they seek to refocus after a week dominated by foreign policy and the turbulent events at U.S. embassies throughout the Middle East.
Romney has accused Obama of being weak on China and ceding American jobs to the rising Asian power. The president countered with claims that Romney has investments in Chinese companies and outsourced jobs to China while running the private equity firm Bain Capital.
On Monday, with both candidates returning to the campaign trail after a weekend out of the spotlight, Obama is turning to the power of incumbency to try to gain the upper hand in the debate.
Officials said the administration will launch enforcement action at the World Trade Organization because it says China is illegally subsidizing exports in their autos and auto parts sectors. The U.S. says the practice puts American parts manufacturers at a competitive disadvantage and encourages the outsourcing of production to China.
The officials requested anonymity because they were not authorized to discuss the trade action publicly ahead of the president.
The administration is taking the issue to the WTO because its attempts to get China to address the subsidies on its own have been unsuccessful, the officials said.
Jobs in the U.S. auto parts sector dropped by roughly half between 2001 and 2010, while U.S. imports of auto parts from China have increased seven-fold, according to the Obama administration.
The administration is also escalating another case it brought against China at the WTO in July that accuses China of imposing unfair duties on more than $3 billion in exports of U.S. autos. The duties cover more than 80 percent of American auto exports to China, said the officials, who requested anonymity in order to discuss the trade action ahead of the president.
The cases stem from the Interagency Trade Enforcement Center Obama set up earlier this year to target unfair practices around the world, particularly in China.
Obama and Romney started trading barbs on China late last week.
Romney released a television advertisement Thursday accusing Obama of "failing American workers" and ignoring unfair trade practices by China. And in his weekly podcast Saturday, Romney said: "In 2008, candidate Obama promised to take China 'to the mat.' But since then, he's let China run all over us."
Obama countered with a TV spot focused on its claims that Romney outsourced jobs to China while working in the private sector. Obama's campaign also released a new web video Saturday in which deputy campaign manager Stephanie Cutter said Romney holds investments in Chinese companies.
The maneuvering came as a new national survey by The New York Times and CBS News found that Romney has lost his longstanding edge on the question of who voters view as most likely to restore the economy and create jobs. Despite that, the poll found the race narrowly divided.
Romney's shift to China also indicated a need to shore up support among the working-class voters he needs to turn out in big numbers come November. Obama's quick counter underscored the importance of holding onto his recent gains in manufacturing-heavy Ohio.
Obama and Romney are both embarking on a week heavy with travel through battleground states and appeals to key constituencies. The candidates are courting voters in a series of must-win states and reaching out to a number of voting groups that could determine the election, from working-class white voters in states like Ohio and Wisconsin to Latino voters in Florida.
Obama was kicking off a week of travel in Ohio on Monday, with stops planned in Cincinnati and Columbus. The president was raising campaign cash in New York on Tuesday, followed by events in Florida on Thursday, Virginia on Friday and Wisconsin on Saturday — all states Obama carried in the 2008 election. Obama was making his first trip to Wisconsin in months and his most pronounced pitch to voters there since Romney added Wisconsin Rep. Paul Ryan to the ticket. Wisconsin has not voted for a Republican presidential candidate since President Ronald Reagan in 1984 and is considered one of Romney's most enticing electoral targets.
Romney's itinerary includes fundraising stops in the Los Angeles area on Monday along with outreach to key Latino voters, including an address to the United States Hispanic Chamber of Commerce and an interview with Spanish-language television network Telemundo. The network interviewed Obama last week.
Romney was also expected to hold fundraising events in Utah and Texas before heading to Florida for fundraisers later in the week.
Romney spent several hours Sunday at a Boston-area hotel with advisers, including Ohio Sen. Rob Portman, conducting some preparation for the fall debates and taping an interview with CBS News' "60 Minutes." The first debate, considered a crucial showdown between Romney and Obama, will be held Oct. 3 in Denver.
Romney had planned to hold a rally in Pueblo, Colo., later Sunday, but the event was cancelled after a small aircraft crashed at the Pueblo airport. The event was scheduled to be held at an aircraft museum near the airport. Romney spokesman Rick Gorka said the campaign did not want to interfere with the investigation or any emergency response efforts.
Romney's plane made a short stop in Kansas City, Mo., to refuel before continuing to Los Angeles.