The mum-of-four, 30, is hotly tipped to be one of the stars taking part in the reality show, when it returns on Channel 5 later this month.
Katona has allegedly told friends that she wants to slim down to a size 8 so that she doesn't look bigger than other female stars in the house.
The Only Way Is Essex's Amy Childs and US star Pamela Anderson are among the female celebs tipped to be joining Katona on the show.
"Kerry is worried about looking old and frumpy next to Amy. She's put herself on a strict diet of salads and low-fat soups to get to a size 8," a source told Closer magazine.
"She's even cut back on fags so she can do more exercise - she's doing her workout DVD and running three miles nearly every day. She's also having facials and planning a weight loss wrap to lose inches quickly."
The former I'm A Celebrity... winner is also rumoured to be concerned about access to alcohol in the house.
"She knows there'll be booze on CBB and she's scared she'll reveal too much about her chaotic life if she has a drink," said the insider. "She can't keep her mouth shut after even one drink. And she gets a bit frisky too."
Watch the Channel 5 Big Brother trailer below: