Smith, 31, played 30 games for the Bills in 2011 and 2012 and has ties to the current Bills coaching staff. He played for Rex Ryan with the New York Jets from 2009-10 and also spent the 2012 offseason in Buffalo working as a quarterback under current Bills quarterbacks coach David Lee.
Lee helped bring the Wildcat offense to the NFL with the Miami Dolphins in 2008, and the Bills potentially bringing back Smith could signal that Lee is looking for a player to help run that package in Buffalo. Quarterback Tyrod Taylor is another candidate for that role.
Smith -- who played 13 games last season with the Philadelphia Eagles -- is known for his versatility. He has experience as a quarterback, receiver, special-teams gunner and kick returner.
If the Bills sign Smith, finding a roster spot for him could be difficult. The team already has Marcus Easley as a receiver and special-teams ace, while receivers Percy Harvin and Marcus Thigpen are expected to compete for kick-returning duties.
The Bills hosted safety Dawan Landry on a free-agent visit last week. Landry, like Smith, played for Ryan in New York.
NFLPA records list the Bills with $7.3 million in cap space. General manager Doug Whaley said last month that the Bills had essentially "tapped out" of the free-agent market and would only consider signing players to deals at or near the NFL's minimum salary.