Castillo was a team-mate of United's Angelo Henriquez at the recent U20 World Cup in Turkey and finished as one of the tournament's top scorers with four goals.
Having taken Henriquez from Universidad de Chile to Old Trafford last summer, reports suggest United are plotting a similar raid on their Santiago rivals Universidad Catolica for £4million-rated Castillo.
Catolica's sporting director Jose María Buljubasich admits the 20-year-old, who has won one senior cap, is keen to make a switch to Europe but says no firm bids have yet been made for his services.
"We can't deny that Nicolas wants to be sold, as any talented young player would," said Buljubasich to Bio Bio. "However, there is no formal offer yet.
"There is interest, but I reaffirm that there is nothing concrete. We understand what he needs, but there is a structure at the club."