The Welsh winger joined Real Madrid from Spurs for a then world-record fee in 2013, going on to win three Champions Leagues, one La Liga title and one Copa del Rey with Los Blancos.
Former Spurs manager Sherwood told talkSPORT: "Every Tottenham fan would love to go out and get Gareth Bale. Don't get three average players for £50m, just go out and buy one special player, and that guy would give the club such a lift.
"Perhaps Daniel [Levy] has got that in the back of his mind. I don't believe it is going to happen because the wages are so high but accumulate it, put it all together in one pot, give it to Gareth Bale and bring him back to Tottenham.
"If they stayed lucky with injuries and got Gareth Bale in their squad, they would win the league this season."
Bale played for Spurs between 2007 and 2013 following a switch from Southampton, making 203 appearances for the North Londoners and scoring 56 times.