Sheikh Mohammed, who owns a huge string of top racehorses, has become friendly with United boss Sir Alex Ferguson through their love of the sport
Last month his company, Dubai International Capital (DIC), bought the Madame Tussauds Group which includes Alton Towers, Chessington World of Adventures and a one-third share in the London Eye for £1.6bn.
DIC have been analysing the club for the last few months and are believed to be ready to table a bid.
"One of their prime concerns is to ensure there wouldn't be opposition from board and fans," said a City analyst.
"There is growing interest in the Middle East in English clubs. We've just seen Emirates Airlines finance the new Arsenal stadium. But whoever comes looking for United is going to have to win over the fans."
DIC's chief executive Sameer Al Ansari said last night: "I cannot comment on this suggestion."