The Uruguayan, 25, has missed the last eight matches through suspension after being found guilty of racially abusing Manchester United's French defender Patrice Evra in the 1-1 draw at Anfield in October.
Suarez had been Liverpool's main attacking threat since arriving in a £22.8 million deal from Ajax in January last year.
In his absence, the Reds have won through to the League Cup final at Wembley, where they will face Cardiff later this month, and the FA Cup fifth round.
But their problems in the Premier League have continued, with just one win in the four matches that Suarez has missed.
His return is sure to be a major boost for the Reds and Dalglish claims the striker has been looking sharp in training.
"Luis is smashing. He's good, he's in and around the place and he's quite happy," Dalglish said.
"We'll have a look and see how he is in training before we pick a team for Monday.
"We'll take everything into mind - we'll have a look at Luis, we'll have a look at the other boys who have played and we'll have a look at the opposition and then we'll make our decision.
"It's great to have him back and available for selection. He's a fantastic player, but then there are a lot of fantastic players in the squad.
"The stronger your squad is, the better chance you have of competing - and he certainly makes the squad stronger as an awful lot of them do."
Dalglish could also recall captain Steven Gerrard, who was rested for the 3-0 victory at Wolves in midweek.
He may well need Gerrard as Tottenham continue to push Manchester City and Manchester United hard at the top of the Premier League table.
And Dalglish claims he would not be surprised if Spurs lasted the distance.
He added: "Spurs were a wee bit unfortunate at the beginning of the season but since then they've kicked on and have been as good as anyone in the league.
"It's a really difficult game for us, but it'll be a fantastic evening and a great occasion for everybody.
"If you're only five points off the top and there are 15 or 16 games left, I think the law of maths would tell you they are contenders."
Tottenham assistant manager Kevin Bond admits Spurs have revised their targets for the season since the start of the season.
Spurs manager Harry Redknapp has talked of his desire to get back in the Champions League, but Spurs were five points behind City going into this weekend's fixture and Bond believes the title is well within reach.
Bond said: "Our aim at the start of the season was to try to finish in the Champions League and we obviously want to do that.
"But we will want to finish as high as we can. The results the other night have drawn us closer to the leaders which is terrific.
"All we can try and do is not look at the big picture, but try and look at the next game, get as many points as we can from it and the league table takes care of its self."
Meanwhile, Redknapp is planning to make a quick dash from London to Liverpool by plane after it was confirmed that his trial for tax evasion will still be running on Monday.
Redknapp has been absent from training for the last week and a half as he has been contesting two charges of cheating the public revenue at Southwark Crown Court.
He has managed to make it to all three of his team's games during that time, but will have to make the 180-mile trip to Anfield from the court, in south London, after Monday's proceedings have come to an end.
The 64-year-old would miss the kick-off if he made the journey by road and he is reportedly considering a plane journey to Anfield.
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