New Raiders general manager Reggie McKenzie, who's at the Senior Bowl in Mobile, Ala., told Comcast SportsNet Bay Area earlier in the day that he had scheduled a Tuesday night interview with Allen but hadn't yet made a final decision.
Allen will be the first defensive-oriented Raiders coach since John Madden was hired before the 1969 season. Oakland likely wanted a defensive mind after ranking 29th in total defense this season.
In his first season as coordinator in Denver, Allen helped the Broncos improve from allowing an NFL-worst 29.4 points and 390.8 yards per game to rank 20th in yards (357.8) and 24th in points (24.4) this season on the way to an AFC West title.
The Broncos increased their sacks total from 23 to 41 as they were tied for the sixth-most blitzes on pass plays in the league this season, according to STATS LLC.
Allen was the New Orleans Saints' secondary coach (2008-10) and assistant defensive line coach (2006-07) for five seasons, and he also served on the Atlanta Falcons' staff as a defensive assistant. He runs a 4-3 scheme, which the Raiders have used for seven seasons.
Oakland needed a coach after firing Hue Jackson following one 8-8 season.
The Associated Press contributed to this report.