Sources: Deron Williams prefers 2

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When NBA free agency begins at midnight July 1, Brooklyn Nets star guard Deron Williams will be choosing from a two-team list that only features the Nets and the Dallas Mavericks, according to sources close to the situation.

Sources told ESPN.com on Saturday night that, while this summer's No. 1 free agent remains "up in the air" about which team he'll ultimately chose, Williams already has made the decision to narrow his list of potential destinations to those two franchises.

Other teams, including the Phoenix Suns, Portland Trail Blazers and Houston Rockets, had been hoping to lodge their own bids for Williams once free agency begins, sources said. The Los Angeles Lakers, likewise have continued to express interest in a sign-and-trade package built around Pau Gasol for Williams, sources say, despite the Nets' longstanding insistence that they have no interest in Gasol and would only consider such a move if they were getting back All-Star center Andrew Bynum, whom the Lakers have not made available.

Sources say Williams, in any case, already has instructed his representatives to advise any team that calls starting at 12:01 a.m. July 1 that he intends to either re-sign with the Nets or return to his hometown with the Mavericks after a glittering high school career in the Dallas area.

The Nets have expressed confidence all season in their ability to retain Williams, pointing to the team's forthcoming move to Brooklyn, increased off-court marketing opportunities for Williams with a team bound for New York and the fact that Russian billionaire owner Mikhail Prokhorov can offer a contract one-year longer than Dallas can worth nearly $100 million.

The maximum four-year offer the Mavericks can counter with approaches $75 million. But sources close to the process say Williams has ruled out every other suitor apart from the 2011 champions because of his respect for Mavs cornerstones Dirk Nowitzki and Jason Kidd and his belief that owner Mark Cuban would make the follow-up moves necessary to return Dallas to title contention after a first-round exit in the 2012 playoffs.

While Williams is already settled in the New York area and known to have enjoyed his time living there, sources say he already has done some preliminary househunting in Dallas this month in the event that he chooses to return to the Western Conference. He's been with the Brooklyn-bound club since Feb. 23, 2011, when the Utah Jazz followed up the New York Knicks' acquisition of Carmelo Anthony by dealing Williams to Prokhorov's Nets, who had chased Anthony for months.

During a promotional appearance in Los Angeles earlier this month, Williams made it clear that he'll choose the team he feels is best positioned to contend for a championship fastest, expressing disappointment that he has tasted very little of the playoffs since leading Utah to the Western Conference finals in 2007.

"I want to go to a place where I feel like they will have a chance to build and build fast," Williams told the Los Angeles Times. "I'm not really in the mood for being part of a rebuilding process. I'm getting older. I'm about to be 28. I want to win. I want to win now. Also, I want to live in a place where I want to live and my kids will enjoy living. That's pretty much it."

The decision, then, would appear to be riding on which team's future he rates higher.

The Nets are hoping the expected re-signing of swingman Gerald Wallace, big man Brook Lopez's pending return from foot trouble and Prokhorov's pledge to keep trying to trade for Orlando Magic center Dwight Howard ultimately will convince Williams to stay.

The Mavs' pitch centers around Nowitzki's proven ability to lead a team to a championship, Cuban's history of repeatedly reloading the roster and Dallas' contention that the path to the Finals might be slightly easier in the West in spite of the Oklahoma City Thunder's collection of talented youngsters, given that several of the West's top contenders -- such as San Antonio and the Lakers -- have older rosters.

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Williams' mother, Denise Smith, told ESPNDallas.com's Jeff Caplan in an interview this week that even she doesn't know which team Williams will choose. But she did say she expects her son to end the suspense quickly.

"No, no I don't (know)," Smith told ESPNDallas.com by phone from her home in the Dallas suburb of The Colony. "I thought he was going one way and another time thought he was going another way."

"I think he and his agent have gone over all of the possibilities and I think it (his decision) will be made pretty fast," Smith continued. "I think he wants it out of the way, just because I know I'm asked every day, so I know he's asked a million times.

Williams and his wife, Amy, who first met in the second grade, have four children. In recent offseasons, though, Williams has based his family in Utah, San Diego and Manhattan, preferring to keep some distance from his Texas roots.

The All-Star guard is scheduled to join his Team USA teammates in Las Vegas on July 5 for the first day of training camp before the London Olympics, but Williams will likely be forced to sit out practices until July 11, which is the first day new contracts can legally be signed this offseason.

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Marc Stein | email

Senior Writer, ESPN.com

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• Senior NBA writer for ESPN.com
• Began covering the NBA in 1993-94
• Also covered soccer, tennis and the Olympics