Why Sunderland could be set for a major boost in pursuit of Arsenal defender
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Millwall, where Ballard made 31 league appearances on loan last season, are reportedly in advanced talks to sign Leeds United youngster Charlie Cresswell.
The centre-back was a target for Sunderland last summer, but in the end a loan was not sanctioned and he would go on to make six senior appearances across all competitions for the Premier League side.
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Hide AdShould the deal be completed it would significantly strengthen Sunderland's hand in pursuit of Ballard, who had been set to complete a permanent deal to Burnley before the move broke down last week.
Millwall retained an interest in bringing the 22-year-old back to the club, but that is seen as unlikely should they sign Cresswell.
Ballard does have significant interest from abroad, meaning the Black Cats do not at this stage have a clear path to signing the Arsenal defender, who has 15 international caps.
It's not yet clear whether any deal would be a loan or a permanent.
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Hide AdThough Bailey Wright is expected to agree a new deal after an extended summer break following his international commitments with Australia, Sunderland will still be in need of significant strengthening at centre back with Danny Batth currently their only other senior option.
Millwall had earlier on Tuesday confirmed the signing of former Sunderland captain George Honeyman, as well as striker Benik Afobe. They finished ninth in the Championship last season, just six points off the play-off places.
Sunderland are also continuing their pursuit of AFC Wimbledon playmaker Jack Rudoni.
Rudoni, who can play in central midfield or off either flank, has been a long-term target for the Black Cats and is expected to leave Plough Lane following their relegation to League Two.
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Hide AdHowever, the Dons are standing firm in their valuation fo the 21-year-old, which is believed to be in excess of £1,000,000.
Sunderland and Huddersfield Town have been leading the race for Rudoni, but there are other clubs interested in securing his signature.
Head coach Alex Neil admitted earlier this week that Sunderland have 'a lot of work to do' in preparation for their return to the Championship.