Yahoo! reported that Maple Leaf Sports and Entertainment CEO Tim Leiweke is prepared to offer Ujiri $3 million annually to return to Toronto, where he was assistant GM for three years before joining the Nuggets in 2010.
Other top candidates for the Raptors include Pacers GM Kevin Pritchard and Thunder assistant GM Troy Weaver, league sources told ESPN's Chris Broussard.
Ujiri is one of the league's lowest-paid GMs, making less than $1 million annually in Denver, where he has reshaped the Nuggets into a Western Conference contender following the 2010 trade of Carmelo Anthony.
His contract with the Nuggets expires June 30, and the 42-year-old Ujiri has said he wants to stay in Denver.
The Nuggets didn't return messages Friday from The Associated Press.
Denver has a history of paying its front-office architects below market salaries, from Kiki Vandeweghe to Mark Warkentien and Ujiri.
Team president Josh Kroenke said earlier this month he didn't think there would be any hiccups in signing Ujiri to a new long-term deal.
The Raptors recently stripped Bryan Colangelo of final say on basketball matters, extending his contract as team president but embarking on a search for a new general manager.
The Raptors were 10th in the Eastern Conference this year, finishing out of the playoffs for a franchise-worst fifth straight season.
Leiweke addressed concerns that keeping Colangelo around would complicate things for any new hire by stressing that the new GM will have complete authority on basketball matters and will report directly to Leiweke, not Colangelo.
Colangelo said he understood the message from his new boss, saying, "The bottom line is, if I get in the way, I'm not going to be around."
A native of Nigeria and the first African-born GM in America's four major sports, Ujiri has deep roots with both teams.
He was a scout for the Nuggets from 2003-07 before joining the Raptors as director of global scouting. He was promoted in 2008 to assistant Raptors GM and returned to Denver on Aug. 27, 2010, where he was handed the Melo-drama with Anthony demanding a trade to the New York Knicks.
After finally engineering the blockbuster deal that next February, Ujiri famously apologized, saying, "We feel we got killed in the trade because we lost a couple of pretty good players. Obviously, Carmelo Anthony, I feel sad for the city of Denver. I feel bad this was done on my watch. To lose a guy like that. And also Chauncey (Billups). But I think we had to do it. We had to do this trade. We had to move on and give this city hope."
The trade turned out to be a win-win for both teams: Denver landed a bevy of young players, trade exemptions and draft picks Ujiri used to retool the roster, and the Knicks got a bona fide superstar to build a team around.
Information from The Associated Press was used in this report.