Sancho remains the Red Devils' number one transfer target in the current window, but their hopes of prising him away from Germany appear to have taken a blow after Dortmund chief Michael Zorc categorically ruled out the possibility of selling the 20-year-old.
The player himself is thought to want a move to Old Trafford and United have not given up hope of signing him, despite Dortmund's £108m asking price.
However, the 20-time champions of England have also begun to look at alternatives should their number one deal not be possible, and ESPN claims that they have made initial contact with Dembele.
The 23-year-old France international managed only five La Liga appearances during an injury-plagued 2019-20 campaign and is understood to be up for sale as Barcelona look to balance their books in the wake of the coronavirus pandemic.
United have reportedly only held informal discussions so far, but would be interested in a season-long loan deal with an obligation to buy.