I believe
@Richard White is suggesting a brand new island, as opposed to locating it on any of the existing Toronto Islands. I assume such an endeavour would require working with the feds as it would change the navigable waters in lake Ontario. Building such a thing in the harbour might also need to go through PortsToronto.
Given that Ontario Place exists, it's not impossible. The tricky part is going to revolve around logistics of moving everything needed to run a stadium, getting players there in a style to which they are accustomed, and moving large numbers of fans to and from. I suspect if there isn't some kind of fixed link for both vehicles and transit, it's not a solution they'd be willing to explore. Ontario Place got the vehicles part, but transit leaves a lot to be desired.