According to The Sun, Collins' sister Jackie used Twitter to reveal the former Dynasty star's interest in the award-winning sitcom.
She wrote: "Benidorm is totally fab. My sis Joan Collins would love to do a guest shot on it. I got her addicted!!! (sic)"
After a peak audience of 7.3m viewers this year, ITV is likely to recommission Benidorm for a fifth series - but no formal announcement has been made yet.
Meanwhile, writer Derren Litten - who had previously confirmed his departure from the show - wrote on the social networking site: "Joan Collins in Benidorm??!! "I ain't gonna let anyone else write that. Looks like I'm coming back. (sic)"
Later he added: "Head swimming with storylines. Of course ITV haven't announced a recommission yet. Somehow don't think we need to worry!"
However, Litten was swift to dismiss reports in this morning's newspapers which claimed he had made the U-turn based on the programme's popularity.
The 40-year-old scribe added: "Don't forget when you read about Benidorm in The Sun tomorrow, the tabloids never let the truth get in the way of a good story."