The singer - who relocated from London to New York following her divorce from film director Guy Ritchie in 2008 - is currently in London directing her new movie 'W.E.', about late British monarch King Edward VIII's decision to abdicate the throne for his American divorcee lover Wallis Simpson.
Despite originally planning to only stay for the six-month shoot, Madonna has rediscovered her love for the UK capital and told ex- husband Guy she wants to move back to Britain for good.
An insider told the Daily Star newspaper: "Guy says she talks about their home in Wiltshire, the kids and their friends in London. She seems nostalgic for her old life. She had built up a big circle of friends and fell in love with London. She'll always love New York but she feels more at ease in London."
Madonna – who has four children, Lourdes, 13, Rocco, nine, Mercy, five, and four-year-old David – is believed to be keen to move back to Britain so she can reconnect with her old friends.
The source explained: "The person she spends most time with is her daughter Lourdes but she is desperate for more adult company."
Madonna, 51, previously said she fell out of love with the UK because she couldn't stand being referred to as 'Madge', her British nickname.
She said: "That's one of the reasons I left England - so I don't have to hear the word 'Madge' anymore. Some people say 'Madge' is a colloquialism for a boring middle-aged housewife. And other people say it's short for Majesty."