Basketball Australia has challenged the Victorian government to build a world-class facility better than the AIS.
The organisation's elite talent program, along with the NBA Global Academy, could relocate from Canberra to Melbourne.
But Basketball Australia has made it clear any move depends on the upgrade of Victoria's State Basketball Centre meeting all their requirements.
That includes residential accommodation for those involved in the Centre of Excellence (COE), with a number of players in the NBA Academy coming from overseas.
"We have a wonderful world-class facility at the AIS and it continues to provide absolutely that for us, having a long history there," Basketball Australia chief executive Anthony Moore told AAP.
"Our conversations with the Victorian government are that you have to match those world-class facilities that we have in Canberra."
It comes days after the Labor government's $126-million election promise to help out the NBL expansion team and upgrade facilities at the Knox headquarters.
The Victorian opposition are yet to announce they are matching the government's commitment.
Moore said Basketball Australia would rather not split operations between Victoria and the ACT.
"If we could get everyone under the one roof, that would be ideal and that's why we're in the discussions," he said.
Moore said there had only been preliminary discussions with the NBA, with their academy beginning in Australia in 2017.
Former centre of excellence head coach Marty Clarke is leading up the NBA Academy in a bid to produce stars of the future.
Australian NBA heroes Ben Simmons, Matthew Dellavedova, Patty Mills and Joe Ingles all started out at the COE.
"We've kept them (NBA) up to date with the discussions we've been having with the Victorian government," Moore said.
"Any speculation we're about to move would be premature."
Australian Associated Press