Reid, currently with Plymouth Argyle was relegated into League Two after the club – facing financial difficulties were deducted 10 points.
United have been looking for a new manager since the departure of Micky Adams following there dismissal from the Championship and look to rebuild in League One. The People reported that Reid has been shortlisted to take the role and has been interviews by the chairman for the vacant position – he his allegedly favourite to become manager of the Blades.
He made his name whilst manger of Sunderland (having previously being with Manchester City); he took over the reins of the then Roker Park club in March 1995 and during his six ½ year stint guided the Black Cats to two successful promotions in 1996 and 1999.
Also, he under saw the big move to the Stadium of Light where they won the Division One title in 1999 at a cantor having only a year previous lost in the famous play-off final against Charlton Athletic.
Other names included to take the hot seat include; Danny Wilson, Roberto Di Matteo, Mark Robins, John Pemberton, Aidy Boothroyd and Chris Hughton.
Reid however hasn’t been paid for several months and the chance to take a position elsewhere may not be easy to turn down.
Though he has yet to confirm his position with both United and Argyle; "Like everyone else involved with the club, I am in limbo. It's not ideal. You might best describe it as interesting.
"Until I know who the new owners are and what's available, I'm waiting like everyone else. The players were not offered new contracts for financial reasons. They were on good wages and we have to work with a new budget in League Two."