Sherdog.com is reporting, Diego “The Nightmare” Sanchez will take on BJ Penn at UFC 74 on August 25 at the Mandalay Bay Event Center in Las Vegas. The main event of UFC 74 is Randy Couture vs. Gabriel Gonzaga. Also fighting is Georges St. Pierre vs. Josh Koscheck. Sanchez only loss came at the hands of Josh Koscheck at UFC 69 back in April. Sherdog is keeping their source anonymous, but Sherdog usually only post news if it’s from a creditable sources. UFC 74 is looking stacked itself with three fights that all could be headlining a UFC event.