Sources close to the 83-year-old former chain smoker say he was diagnosed at New York's Sloan-Kettering and is receiving care from a leading oncologist.
"It's so awful. He's dying," said a family member.
Newman, who retired from acting in May 2007, has had a varied and acclaimed career, including turns in "Butch Cassidy and the Sundance Kid" with Robert Redford, and The Color of Money with Tom Cruise, for which he won the Best Actor Oscar.
Newman also heads several charitable organizations, including the Newman's Own brand of foods.
His food brand has been extremely successful finding Newman donating millions of dollars from all proceeds to thousands of charities. His Hole in the Wall Gang Camp, which creates summer camps for terminally ill kids, has also received untold thousands from the actor.
His affinity for car racing is unmatched, despite the pleas of his longtime wife, Joanne Woodward.