The veteran manager would like to bring Everton striker Dominic Calvert-Lewin to the Bernabeu, according to the Sun.
The report says he believes £50million would be enough to convince the Toffees to part with the England international.
Ancelotti is also contemplating a reunion with a man he brought to Goodison Park, with Sport reporting James Rodriguez is a possibility to return to Real Madrid.
Sevilla's Jules Kounde is also on Ancelotti's list, Marca reports, though the quoted €80m (£69m) asking price will be a concern.
- Manchester United is set to bid more than £75m to bring Jadon Sancho back to England after Borussia Dortmund rejected an initial £67m offer, the Mail reports.
- United also faces competition from Paris Saint-Germain for Atletico Madrid's English full-back Kieran Trippier, says France Football.
- Manchester City will offer about £100m to lure Harry Kane from Tottenham, the Star reports.
- Barcelona would like to add Andre Silva to their strike force with a €35m offer to Eintracht Frankfurt, ESPN reported. Manchester City and Atletico also are interested in the Portugal international.
- In the meantime, Miralem Pjanic is set to leave Barca for a return to Serie A, with Juventus the expected landing spot, Corriere dello Sport claims.