The 20-year-old enjoyed a breakthrough season at Stamford Bridge last season, making 17 first-team appearances for the Blues across all competitions, including five starts and 12 substitute outings.
However, following the departure of Mauricio Pochettino and arrival of new head coach Enzo Maresca, the decision was made for Gilchrist to be left out of Chelsea's squad for their pre-season tour of the United States.
Chelsea plan to loan out the academy graduate next season so that he can gain regular first-team football, and The Athletic reports that they have agreed to send the youngster to Sheffield United.
The report adds that Gilchrist is due to undergo a medical on Tuesday ahead of completing his temporary switch to the Blades, who are understood to have fought off interest from fellow second-tier clubs as well as Serie A side Como - managed by ex-Chelsea midfielder Cesc Fabregas - to win the race for the defender's signature.
Juventus 'make contact' with Porto winger Galeno
Over in Serie A, Juventus have reportedly stepped up their interest in signing Porto winger Galeno.
The 26-year-old winger has established himself as an important first-team player for Porto since re-joining the club from Barga in 2022, scoring 33 goals and providing 21 assists in 101 appearances across all competitions.
Galeno enjoyed an impressive 2023-24 campaign, recording 16 goals and 12 assists in 48 games, and he has since made a bright start to the new season having scored twice in Porto's Supertaca Candido de Oliveira final win over Sporting Lisbon last weekend.
The Brazilian winger still has four years remaining on his Porto contract, but journalist Fabrizio Romano claims that Juventus have made contact with the player's representatives to discuss a possible summer transfer to Turin.
Juventus are said to have identified Galeno as one of their top targets, although Porto's are currently demanding a package in the region of €40m including add-ons.
Thiago Motta's side are expressing their interest in Galeno at a time when Federico Chiesa is deemed surplus to requirements and could allegedly be sold for a little as £12.8m.
Ex-Arsenal winger joins Villarreal on free transfer
Elsewhere, Villarreal have completed the signing of former Arsenal winger Nicolas Pepe on a free transfer.
The 29-year-old failed to reach the heights expected when he joined the Gunners in 2019 for a then club-record £72m and eventually left the club upon the expiration of his contract in 2023.
Pepe spent last season at Turkish outfit Trabzonspor where he chipped in with six goals and three assists in 27 appearances, but his short-term deal expired at the end of June.
The former Lille winger was linked with a possible return to Ligue 1 as well as a switch to Saudi Arabia, but he has made the decision to join La Liga side Villarreal on a two-year deal.
Pepe has become Villarreal's fifth summer signing after Willy Kambwala, Diego Conde, Pape Gueye and Sergi Cardona, and has now begun training with his new teammates at the Jose Manuel Llaneza Training Ground ahead of the new season.