Varela joined United last summer for around £2m from the Uruguayan side Penarol, but he is yet to make an appearance for the club.
And now, according to TMW, Madrid are preparing to take the 21-year-old right-back on loan for the season with a view to a permanent deal.
It is reported the Spanish giants would be willing to pay around £4m to make the deal a permanent one next summer.
As of yet United have given no indication they would be selling to Varela, who still has four years remaining on his current contract.
Camisetas De Futbol
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