Muhammad Ali's family have started making funeral arrangements after doctors warned that the legendary boxer is just hours from death, sources claimed.

The legendary boxer, 74, is reportedly on life support at a hospital outside Phoenix, Arizona, after he was found 'barely breathing' at his home on Thursday.

Ali is surrounded by his family who rushed to be at his bedside on Friday after doctors warned his condition was 'rapidly deteriorating', Radar Online reported.

A source, who said he had spoken to the three-time heavyweight champion's wife, Lonnie, said: 'It's extraordinarily grave. It's a matter of hours.

'It could be more than a couple of hours, but it's not going to be much more. Funeral arrangements are already being made.'

Ali was taken to hospital on Thursday with an 'unshakeable cough', a separate source said, with his reported respiratory problems likely to be complicated by his Parkinson's disease.

'Doctors are telling the family that it likely won’t be long until he passes away,' one insider said.

Another source said Ali's vitals 'are terrible', adding: 'Ali is in dire straits and is rapidly deteriorating. His breathing has become very shallow, requiring tubes.'

Scroll down for video

Fighter: Muhammad Ali (above in 2011) is reportedly on life support as he deals with respiratory issues

Medical issues: Ali (above with wife Lonnie Wiliams in October) was taken to a hospital on Thursday after he began having difficulty breathing

Brutal: Ali stands over fallen challenger Sonny Liston, shouting and gesturing shortly after dropping Liston in a 1965 fight

His third wife Veronica Porsche said in an interview on Friday that her two daughters with Ali - Laila and Hana - were on their way to see their father. They are believed to have since arrived at the hospital.

'My daughters have both flown there and I will be hearing from them when they arrive at the hospital,' Porsche told Radar Online.

'I can’t comment more than that but I will say it is not so great, I’ll just say that much. He’s a real hero. It’s a sad situation.'

Ali's second wife, Khalilah, also said that one of her daughters was rushing to see the boxer in the hospital.

A source told Radar: 'The family feels that even if he somehow survives this setback, he’ll be left in a vegetative state.

'He can’t stand due to stiffness in the legs. Before this incident, he would sometimes freeze upon standing, like his feet are stuck to the ground. Now he cannot even do that.'

They added: 'Doctors fear he’s in the early stages of dementia. Or possibly beyond that.

'The family has gathered around him and is prepared for the worst.'

Ali has been married four times, most recently to his current wife Lonnie, and has nine children - seven daughters and two sons.

Ali's spokesman, Bob Gunnell, said on Thursday that the boxer was being treated for a respiratory issue at a hospital he would not name and refused to elaborate any further on the matter other than to say his client was in 'fair condition' and that the hospital stay would be brief.

'He is being treated by his team of doctors and is in fair condition,' said Gunnell.

'A brief hospital stay is expected. At this time, the Muhammad Ali family respectfully requests privacy.'

He released another statement on Friday stating that there had been no change to Ali's condition.

Laila Ali spoke about her father's health struggles in interview with People in March, saying: 'He's such a fighter, still, when at times he seems weak and not able to handle it.

'He comes through stronger than ever. He's still fighting regardless and I love my dad for that.'

A representative for Laila told Entertainment Tonight on Friday: 'Laila's number one priority is her father's well-being.

'She truly appreciates the outpouring of love for her family, as she spends quality time with her dad.'

Ali's daughter Laila posted a touching family photograph of her father holding her as a baby, thanking supporters for their kind messages

Family time: Ali poses with some of his seven daughters and two sons (above) at his most recent birthday party in January of this year

Daddy's girls: Ali with his daughter's Laila (left) and Hana (right) at his birthday party in January

Ali has been hospitalized several times in recent years, most recently in early 2015 when he was treated for a severe urinary tract infection initially diagnosed a month prior as pneumonia.

He has also been battling Parkinson's for decades now, and brought much awareness to the disease thanks to his high profile and willingness to share his very public struggle since being first diagnosed in the early 1980s.

His Parkinson's has long been linked to the number of times he took blows to the head during fights.

The boxer has looked increasingly frail during public appearances over the past few years, including one in April 9 where he wore sunglasses and was hunched over at the annual Celebrity Fight Night dinner in Phoenix, which raises funds for treatment of Parkinson's.

His last public appearance prior to that was in October of last year when he appeared at the Sports Illustrated Tribute to Muhammad Ali at The Muhammad Ali Center in his hometown of Louisville, Kentucky.

He was joined by former opponents George Foreman and Larry Holmes at that event.

Number 1 fan: Proud Ali stops for a photograph after watching his daughter Laila win a Super Middleweight title

Hard work: Ali (above in 1970) won the World Heavyweight Championship three times over the course of his career, a record that still stands

Born Cassius Marcellus Clay Jr. on January 17, 1942, Ali took up boxing at age 12, when his bike was stolen and he wanted to find and whip the culprit.

The boy was introduced to Joe Martin, a police officer who coached boxing at a local gym.

Ali's brother, 68-year-old Rahaman Ali, recalled on Saturday night that the champ was cheerful and happy as a youngster.

'As a little boy he (said) he would be the world's greatest fighter and be a great man,' he said.

BOXERS SEND SUPPORT TO ALI Boxers and former champions have sent their support to Ali as he faces his greatest fight. Boxing legend Sugar Ray Leonard tweeted: 'Prayers & blessings to my idol, my friend, & without question, the Greatest of All Time @MuhammadAli' WBC heavyweight champion Deontay Wilder wrote: '#MuhammadAli is an idol to me.... I hope and pray that he pulls through. #KeepFighting' WBC Cruiserweight Champion Tony Bellew said: 'Pray for Muhammad Ali right now.. #PrayForAli #TheGreatestManToEverBox' Amir Khan tweeted: ' Our Prayers and thoughts are with @MuhammadAli and his family.' Advertisement

Ali flourished in the ring, becoming a top amateur and Olympic gold medalist.

He made his professional debut in Louisville and arranged for a local children's hospital to receive proceeds from the fight.

His decision alienated Ali from many across the U.S. and resulted in a draft-evasion conviction.

Ali found himself embroiled in a long legal fight that ended in 1971, when the U.S. Supreme Court ruled in his favor.

Ali lost his first bid to regain the heavyweight crown when Frazier knocked him down and took a decision in the 'Fight of the Century' at Madison Square Garden in 1971.

Ali regained the heavyweight title in 1974, defeating Foreman in the 'Rumble in the Jungle.'

A year later, he outlasted Frazier in the epic 'Thrilla in Manila' bout.

Ali's last title came in 1978, when he defeated Leon Spinks.

Ali retired from boxing in 1981 and devoted himself to social causes.

He traveled the world on humanitarian missions, mingling with the masses and rubbing elbows with world leaders.

Ali received the Presidential Medal of Freedom from President George W. Bush in 2005.