Owner Steve Stephenson said he's asking USD 50,000 for the small white house with a sagging front porch overhang, the Daily mail reported.
Ali had last visited his home in Louisville earlier this year to celebrate his 70th birthday.
The house is situated along a tree-lined western neighbourhood made up of mostly neat, modest homes.
The property is assessed at USD 23,260, according to the Jefferson County Property Value Administrator's website.
In front of the one-storey home is a state historical marker recognising the residence as Ali's boyhood home, when he was known as Cassius Clay.
The marker says Ali lived in the mostly black neighbourhood with his parents and brother and attended local public schools.
It was at home where the future boxing champion's 'values were instilled', the marker reads.
Louisville Mayor Greg Fischer said the city has an interest in preserving the home of a world-famous native son.
"Anything we can do to preserve and expand his legacy, we want to do that," Fischer was quoted as saying by the paper.
"His home serves as an inspiration for people to look at that and say, 'If this young guy, why not me?'," he added.
The three-time world heavyweight champion remains one of the most recognisable figures on the planet, even though his public appearances have become sporadic as he fights Parkinson's disease.
He retired from the ring in 1981 and devoted himself to social causes. He travelled the world on humanitarian missions and received the Presidential Medal of Freedom from President George W Bush in 2005.
Through it all, Ali kept his ties to his hometown. The Muhammad Ali Center, a museum and education center in downtown Louisville, is one of the city's prime tourist attractions.
Now, the home is showing outward signs of disrepair. Fischer said it's nothing that can't be repaired.