The show failed to win back viewers this year and insiders say that show bosses want to recreate the panel that was most popular.
A source said: “Dannii is still very popular in the UK and many people at ITV feel the return of Sharon Osbourne this year was positive and would like to do the same with Dannii.”
The singing competition was at it’s biggest three years ago when Dannii was on the panel, alongside Cheryl Cole, Simon Cowell and Louis Walsh.
The source said: “The show was most successful a number of years ago so they need some of that success and spark, perhaps mixed with one or two new faces from the music industry today.”
It is thought that Robbie Williams, Olly Murs and Rita Ora are also being considered for judging roles.
When asked last year if she would work with Simon again, Dannii told a UK newspaper that she would never rule it out.
The 42-year-old said: “Never say never. I wouldn’t rule it out. He is amazing and Iearnt so much from him on that show.
“It put me in a really good place for working on Australia’s Got Talent, working on this show, and it changed my whole career around.
“I had never thought I want to be a judge, it isn’t something you can plan to do.”
During the X Factor final’s of 2009 and 2010 – Dannii was a judge for both of these – the show had almost 20 million viewers.
However, just 9 million people tuned in to see Sam Bailey win this year’s series.