The X Factor judge has been photographed with the R&B hitmaker after they landed at New York's LaGuardia Airport together, reports The Sun.
The pair are allegedly spending the weekend together, after already being spotted together in Miami back in March.
A source said: "They've been hooking up more and more and tongues have been wagging. He's been telling his pals all about Tulisa and how talented she is."
Contostavlos was previously romantically linked with British actor Jack O'Connell, but the couple reportedly split up in the last week.
The-Dream - real name Terius Youngdell Nash - has co-written tracks including Beyoncé's 'Single Ladies (Put a Ring on It)', Justin Bieber's 'Baby' and Rihanna's 'Umbrella'.
Watch Tulisa Contostavlos's video for 'Young' below: