Kevin Blackwell enquired about Gray last month when Mick McCarthy was still manager but was told that a transfer would only be sanctioned if it was on a permanent basis.
But since caretaker boss Kevin Ball has taken charge, Blackwell has been told he can take Gray on loan until the end of the campaign.
The former Leeds striker has not started a Premiership match this year and having lost Richard Cresswell for the remainder of the season, Blackwell sees Gray as an ideal signing for Leeds' push for promotion.