St George Illawarra have until 5pm on Friday to table a formal offer to Benji Marshall or they will lose him to arch-rivals Cronulla.
After waiting more than a week to receive the Dragons offer in writing, Marshall has set the deadline on the club.
If the Dragons deliver on the deal discussed verbally, he will join the club for the rest of this season and a further two years.
However, the Sharks have forwarded a formal offer and are waiting in the wings if St George Illawarra are unable to finalise the terms of their deal.
It is understood the Dragons need to shift a player from their squad to accommodate Marshall, and there is speculation a forward may be heading to England to join a Super League club.
St George Illawarra are also among a raft of clubs trying to sign Melbourne back-rower Kevin Proctor for next season.
Dragons officials have been in discussions with the NRL about ways they can fit Marshall under their salary cap for this season.
Halfbacks Sam Williams, Michael Witt and Kyle Stanley are among 12 players off contract at the end of the season, along with second-rower Bronson Harrison and prop Matt Groat.
The Cronulla offer is also for 2½ years and is understood to be about $100,000 less than that proposed by St George Illawarra.
While Marshall is good friends with a number of players at the Sharks, who boast seven of his former Wests Tigers teammates, the Dragons are firm favourites to sign him and coach Steve Price is understood to have been in regular contact with the 29-year-old former New Zealand captain.
Marshall met Price last Wednesday and he is keen to play in a backline that includes England halfback Gareth Widdop, Australian winger Brett Morris, Kiwis winger Jason Nightingale, centre Gerard Beale and NSW Origin fullback Josh Dugan.
However, Cronulla also boast some big name players and he is conscious of the fact he can't keep the Sharks waiting too long after they tabled their offer this week.
Initially, Marshall had hoped to receive the Dragons offer by Wednesday so he could make a decision but St George Illawarra chief executive Peter Doust was attending the NRL CEO's meeting, which announced significant changes to the salary cap.
Among them is the introduction of a marquee player allowance in which the NRL could top up a player's contract outside the salary cap but that does not commence until January 1, so is of no assistance to St George Illawarra.
Dragons players have backed the club's bid to sign Marshall and if the deal can be finalised on Friday he may make his debut in the Red V against Parramatta next Saturday night.
If he was to join the Sharks, Marshall's first match could be against the Tigers in a game that would attract massive interest after his bitter split with the club last year.
After being the face of the Tigers for most of his 12-year stint at the club, Marshall felt officials reneged on a promised upgrade and extension of his contract and sought a release to play Super Rugby for the Auckland-based Blues.
However, the move did not work out and he announced he was returning to the NRL on Easter Monday after a meeting with Blues coach John Kirwan.
Melbourne, North Queensland and Parramatta also expressed interest in Marshall but his decision narrowed to the Dragons and Sharks late last week.