Sky Sports understands MK Dons have opened talks with Alan Smith about a permanent deal at Stadium:mk.
The former Leeds and Manchester United man is out of contract at Newcastle next month and he is expected to move on.
Smith spent the second half of last season with the Dons and made a big impression during his stay at the League One club.
The 31-year-old made 15 appearances and scored two goals as they lost out to Huddersfield in the play-off semi-finals.
Dons boss Karl Robinson is keen to keep Smith on board as he looks to mount another bid for promotion next season.
A number of other clubs are thought to be monitoring Smith's situation as they weigh up a move for the former England international.