Rob Letterman is directing the new project, which focuses on travel writer Lemuel Gulliver (Black), who gets lost in the Bermuda Triangle and finds himself on the island of Lilliput.
As fans of the Swift original will recall, Lilliputians are a tiny people and Blunt would play their queen, the love interest to the main character. Segel would play Gulliver's Lilliputian friend Horatio.
The project would reteam Segel ("How I Met Your Mother") with his "Forgetting Sarah Marshall" director Nicholas Stoller, who wrote the "Gulliver" script with Joe Stillman.
Perhaps the biggest question in the two trade paper reports is how "Gulliver's Travels" could impact Blunt's ability to play Black Widow in the upcoming "Iron Man 2," a role she'd reportedly been offered.
The Hollywood Reporter says that if the proper scheduling is in place, the "Wolfman" star may be able to do both movies, leaving it at that.
The Variety story, which goes into a great deal more depth, observes that 20th Century Fox has an option on Blunt stemming from "The Devil Wears Prada" and that option could be invoked to make sure she does "Gulliver."
Variety adds that "Gulliver's Travels" will probably shoot in late March, while "Iron Man 2" will begin production in early April, which could make overlap inevitable, though accommodations could be made.