The former AC Milan player, who transferred to Liverpool last summer in a €22 million deal, is reportedly being eyed by Bologna, which was recently promoted to Serie A, the reports said.
Other clubs have also shown an interest, but the clearest indication has come from Bologna, with the club's director telling Corriere dello Sport: “I would take him, he would be highly motivated here. Of course, Bologna has to respect certain financial parameters, but for the right price I would even look at the possibility of buying him outright.'
There were high hopes when the 24-year-old moved to Liverpool after last summer's World Cup in Brazil
Supporters even spent an estimated €63,425 on the red shirts featuring his name.
But despite a promising debut, the fiery Balotelli offended fans during a game against Real Madrid last October when he swapped his shirt at half-time with the Spanish side's defender, Pepe.
Irish bookmaker Paddy Power then seized on the marketing opportunity to open a ‘Mario Swap Shop' outside Liverpool's Anfield ground, where fans happily swapped their Balotelli shirts for those featuring the names of "real" Liverpool stars, including Ian Rush and Michael Owen.
Since then, things got worse, with Balotelli scoring just four goals in 28 games with Liverpool.
Liverpool are believed to be willing to sell him for a fee of around £7 million (€9.9 million).