Poya Asbaghi’s side are bottom of the league and 11 points from safety with just four games left.
His future as head coach is also unclear, having won five of his 27 games since been appointed in November.
Asbaghi’s position was reportedly under threat earlier this season after he set a new club record for the longest wait for a league win – 12 games.
Warnock, who has since retired, was linked with the post in February following his departure from Middlesbrough in November.
Asked if he was offered the chance to return to the dugout at Oakwell, Warnock replied: “Not really. I would have done, I think. But I wasn’t really asked.
"They have gone in the direction they are going in. They must think that’s the right way.”
The 73-year-old, who won a record eight promotions during his 42-year management career, previously saved Rotherham United from Championship relegation in 2016 under similar circumstances Barnsley found themselves in.
Barnsley’s six head-coach appointments since majority shareholders Pacific Media Group arrived in December 2017 have been from overseas.
Club legend Neil Redfearn, who is now in charge of Sheffield United Women, is understood to have been among the candidates considered before Gerhard Struber’s appointment in 2019.
Warnock spent two years with Barnsley as a player from 1976 to 1978.
"That was my best year as a player,” he recalled.
"I must have scored double figures, which for a winger was brilliant.
"Me and Pughy (Graham Pugh), we used to always go in the club at the end of the road when we had a game, even if we got beat.
"When you get in that door and you have to walk to the bar past all those flat-caps, it was hard. But we always did it.
"I think they admired us for that, the fans. Win or lose, we always went in there, walked to the bar, listened to all the snipes.
"If we had a good result it was great, one or two of the other lads would come in.”