The 10-inch Amazon Kindle Fire 2, according to the source, will come packed with a more powerful quad-core processor.
Both new Kindle Fire tablets will reportedly be of higher-quality materials and more ergonomic designs.
Kindle Fire 2 specs
The original Kindle Fire's plastic body is being replaced by matte black metal, with a shiny, chrome-like "rib" on the back that looks sharp and feels better. The speakers are supposedly located here as well.
"It's really up a notch from the current Fire," claims the source.
Furthermore, the report says that Amazon's new Kindle Fire 2 tablets will be thinner and more similar in appearance to the first-generation Apple iPad, but without any buttons on the front.
In addition, the 10-inch Kindle Fire will house a front-facing camera, and both new tablets will include microUSB ports and, possibly, HDMI-out jacks, says the report.
Competition from Google's Nexus 7 tablet
As far as price and functionality go, Google's Nexus 7 tablet can easily compete with the existing Kindle Fire.
And the Nexus 7's specs surpass those of the Kindle Fire.
But until Amazon reveals more about the upcoming 7- and 10-inch Kindle Fire 2s, it's unclear which tablets will come out on top.
"The whole tablet market is due for a radical change over the next one to two quarters," J. Gold Associates analyst Jack Gold told TechRadar earlier this week.
It looks like his prediction may prove to be spot-on.
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Michael Rougeau is a former freelance news writer for TechRadar. Studying at Goldsmiths, University of London, and Northeastern University, Michael has bylines at Kotaku, 1UP, G4, Complex Magazine, Digital Trends, GamesRadar, GameSpot, IFC, Animal New York, @Gamer, Inside the Magic, Comic Book Resources, Zap2It, TabTimes, GameZone, Cheat Code Central, Gameshark, Gameranx, The Industry, Debonair Mag, Kombo, and others.
Micheal also spent time as the Games Editor for Playboy.com, and was the managing editor at GameSpot before becoming an Animal Care Manager for Wags and Walks.