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Published 22:36 7 Dec 2016 GMT
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The 68-year-old is a co-founder and former CEO of the WWE. She unsuccessfully ran for the US Senate seat in Connecticut six years ago and was an early supporter of Trump's bid to become president.
The Small Business Administration (SBA) provides support to small businesses across the nation, with at least one office in each state. Trump, a WWE Hall of Fame member, has pointed out that McMahon's experience of growing the wrestling federation from a 13-person operation to globally recognised company with over 800 employees makes her idea for the role, which must be approved by Senate.
"Linda has a tremendous background and is widely recognised as one of the country’s top female executives advising businesses around the globe," Trump said.
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