The Portuguese right-back spent last season on loan at AC Milan and the Italians are keen on signing him permanently after Dalot impressed during his 33 appearances for the Serie A giants.
However, United have so far been unwilling to play ball with Milan and Ole Gunnar Solskjaer could call on Dalot as back-up to Aaron Wan-Bissaka next season if the club fail to pull off a deal for Atletico Madrid ace Kieran Trippier.
But should Trippier arrive, United would likely cash in on Dalot and AS report that Ancelotti is an admirer of the former Porto man.
Ancelotti was keen on signing Dalot during his time at Everton and he feels Dalot could make the step up at the Bernabeu, either on loan or on a permanent basis.
Dalot was given a late call-up into the Portugal squad this summer after Joao Cancelo had to pull out due to Covid-19 and the tournament further enhanced his reputation with Ancelotti.
Dalot, too, feels he’s now at a stage of his career where he must play more regularly having made just 34 appearances for United since joining from Porto in 2018 for £18m.
United are keen on signing Real Madrid defender Raphael Varane and have already agreed personal terms with the Frenchman.
However, they’re yet to open formal discussions with Madrid for Varane – though they’re expected to do so in the coming days.
Madrid may opt to raise their interest in Dalot during talks and the Portuguese could be used to lower the asking price for Varane.
MORE : Albert Sambi Lokonga names his best position after signing for Arsenal