The trip marks the exiled Tibetan leader's first visit to the United State since China's crackdown on Tibet. The event, sponsored by the group Seeds of Compassion, will include a concert by Dave Matthews.
Seattle Mayor Greg Nickels will present the key to the city and the University of Washington will give the leader an honorary degree.
Dhonden, a Tibetan monk, partnered with Seattle businessman Dan Kranzler to organise the event, and has consulted with the Dalai Lama since 2005 about it.
The Dalai Lama fled Tibet after a failed uprising in 1959, but remains the religious and cultural leader of many Tibetans.
No large pro-Tibet demonstrations are expected out of respect to the Dalai Lama, Tibetan community leaders said.
President George Bush on Wednesday again exhorted Beijing to reach out to the Dalai Lama to find a solution.
The US House of Representatives passed a resolution criticising China for its "disproportionate and extreme" response to protests in Tibet, and urged the Beijing government to hold direct, unconditional talks with the Dalai Lama.