The Owls' program has been plagued with inferior facilities and budget woes, and there has been talk that the program would drop to Division I-AA.
Sandusky, 44, has been an assistant under Penn State coach Joe Paterno for 20 years.
The Temple job was vacated by Bruce Arians on Nov. 27.
Neither Sandusky nor Temple athletic director Charles Theokas could be reached for comment yesterday.
Sandusky graduated from Penn State in 1966 and joined the Nittany Lions' coaching staff in 1969. He formerly served as linebackers' coach, developing such linebackers as Jack Ham, Greg Buttle and Shane Conlan, and he has served as defensive coordinator for the last few seasons.
Sandusky would fill Temple's need for a high-profile coach from a successful program with the ability to recruit talented athletes.
Sandusky is the author of Developing Linebackers the Penn State Way and organized a nonprofit program called the Second Mile, which operates a home for troubled youths on 20 acres of farmland in Patton Township outside State
His defensive game plans have stopped three Heisman Trophy winners - Southern Cal's Marcus Allen in the 1982 Fiesta Bowl; Georgia's Hershel Walker in the 1983 Sugar Bowl, and Miami's Vinny Testaverde in the 1987 Fiesta Bowl.
As defensive line coach, Sandusky has developed seven first-team all- America linebackers: Ham (1970), Charlie Zapiec (1971), John Skorupan (1972), Ed O'Neil (1973), Buttle (1975), Kurt Allerman (1976) and Conlan (1985 and 1986).
Another candidate mentioned for the Temple job, James Madison head coach Joe Purzycki, told a Harrisonburg, Va., newspaper yesterday that he had withdrawn his name from consideration.