The Express & Star revealed last month that Albion would enter the race to sign the former Wolves man if he runs down his contract and leaves The Den this summer.
Millwall and Rowett are still hoping they can keep Wallace in the capital – while Leeds and Nottingham Forest are also believed to be keen on the 28-year-old.
Albion boss Steve Bruce, though, is understood to be a big fan of the former Portsmouth man.
And Rowett concedes there is a good chance Wallace will leave Millwall as a free agent this summer.
“I think there is a possibility of (him leaving),” Rowett said.
“He’s earned the right with his performances, over a long period of time.
“He’s a top-quality Championship player who, I know, can play at different levels of the game.
“He’ll have options. The chances are he might not be here next season.
“If he is, fabulous – that’s one less problem to worry about. But if he’s not then big boots to fill.
“Good luck to him. He’s been fabulous for me.
“He has got Premier League quality and, on a free transfer, there will be a hell of a lot of teams looking at him.”
Baggies boss Bruce has made it clear he wants to exploit the free agents market this month.
Alongside Wallace, the Express & Star understands Reading’s Jon Swift is a key target as Bruce looks to add more creativity and flair to his squad.
Another free agent the Baggies are understood to be keen on is Blackburn centre-back Darragh Lenihan.
The 28-year-old, who came through the youth ranks at Ewood Park, plays alongside Dara O’Shea for the Republic of Ireland.
Bruce said multiple times last season that his squad was top heavy with centre-backs.
But Matt Clarke has returned to Brighton following his loan.
Youngster Caleb Taylor is likely to go out on loan next season.
Meanwhile, it is understood the Baggies will listen to offers for Cedric Kipre – with the Frenchman’s Albion career having never really got going following his £900,000 move from Wigan in 2020.
While the Express & Star understands Wallace, Swift and Lenihan are all targets for Albion this summer, reports elsewhere linked the Baggies with a move for Blackburn midfielder Joe Rothwell.
Rothwell has left Ewood Park as he looks for a new challenge for the 2022/23 campaign.
Promoted Bournemouth, though, are believed to be leading the chase for the 28-year-old.
It has also been reported Bruce is keen to raid former club Newcastle to sign Elliot Anderson on loan.
The 19-year-old was on loan at Bristol Rovers last season and wrote his name in footballing folklore by scoring the seventh – and crucial – goal that saw Joey Barton’s side win promotion last weekend.
Anderson has a whole host of Championship clubs queuing up to sign him in the summer.
There is also a chance Eddie Howe will want to take a closer look at him in pre-season.
Bruce, though, may be hoping his connections at Newcastle can help lure Anderson to The Hawthorns.