Watford and Sunderland are both keen to sign Atletico Madrid full-back Javier Manquillo, according to Sky sources.
It is understood the Hornets are after a right wing-back and the former Liverpool defender is a key target as the end of the transfer window approaches.
But Sunderland boss David Moyes is also in need of a right-back and is keen on the 22-year-old former Spain U21 international.
Manquillo joined Liverpool on a two-year loan deal as part of a major recruitment drive under former manager Brendan Rodgers in the summer of 2014 but he made just 10 Premier League appearances before he was sent back.
Manquillo, who has represented Spain at every youth level from U16 to U21, spent last season on loan at French Ligue 1 club Marseille, where he played 37 times.
The Madrid-born right-back began his career as a Real Madrid trainee before switching to Atletico as a 13-year-old along with his brother Victor in 2007.