The former Swindon boss has taken over from early front-runner Steve McClaren.
Martin O'Neill was axed by the Black Cats on Saturday night, just hours after a 1-0 home defeat to Manchester United left them just one point and two places outside the Premier League's relegation zone.
Sky Bet have cut Di Canio, currently out of work after leaving Swindon last month, from 9/2 to 2/1 for the post with other firms making similar moves. Ladbrokes and Paddy Power offered 3/1 on Sunday morning.
McClaren, who departed Dutch club FC Twente last month, had quickly been established as the favourite on Saturday night - Sky Bet intitially laid 18s but were soon forced as short as 6/5. They went back out to 3s on Sunday, with Power and Ladbrokes lengthening their price fo 5/1.
12 Southampton 34
13 Stoke City 34
14 Norwich 34
15 Newcastle 33
16 Sunderland 31
17 Wigan 30
18 A Villa 30
19 QPR 23
20 Reading 23
Sky Bet also reported some money for former Chelsea manager Roberto Di Matteo, ex-QPR chief Mark Hughes and current Brighton boss Gus Poyet, who recently snubbed Reading's advances.
Ladbrokes currently offer a standout 15/8 about Sunderland being relegated. They are 1/2 to stay up with BetVictor.