The controversial Italian forward – dubbed ‘Mad Mario’ for his off-field antics – only moved back to his homeland in January 2013 from Manchester City, but is already said to be ready to make another big transfer.
Arsenal manager Arsene Wenger is understood to be keen on the goal-getter, and his agent Mino Raiola is set to meet with the London club to discuss a potential return to England.
Balotelli is likely to cost around £25m, but the Gunners could stretch to this thanks to their imminent, and lucrative, kit deal with Puma.
The 23-year-old has found his private life coming under increased scrutiny since his move to Milan, which is believed to have forced him to consider his options.
Arsenal are known to be in the market for a new striker, with Wenger keen to bolster his attacking ranks.
Balotelli enjoyed a turbulent spell in the Premier League with City, where his performances helped the Sky Blues to success on the pitch, but his actions away from the field frequently made headlines.
Chelsea are also in the race, after the Italian international admitted that he would like to work with Jose Mourinho once again.