McCarthy was 4/1 for the Barnsley vacancy on Thursday morning, but has seen his odds cut to 8/11 in the space of a few hours.
Lincoln City's Danny Cowley remains at 6/4 with the bookmaker, although no other boss is listed at shorter than 10/1.
McCarthy, who is from Barnsley and began his playing career at Oakwell, is out of contract at Ipswich in May.
Despite leading Ipswich to three top-half finishes on a limited budget, the 59-year-old is well aware that he is not everyone's cup of tea in Suffolk.
Barnsley fans, meanwhile, showed their appreciation for McCarthy after their side wished him a happy birthday on the social media website later that day.
Ipswich / Barnsley fans - what would you make of McCarthy's appointment at Oakwell?