Arsenal have confimed they have rejected a bid from Atletico Madrid for winger Jose Antonio Reyes.
Reyes joined the Gunners in January 2004
Gunners vice-chairman David Dein told Sky Sports News: "They have made an offer which has been rejected.
"As it stands today, Jose Antonio Reyes is an Arsenal and he may very well remain an Arsenal player."
The 22-year-old had also been linked with a move to Real Madrid, but a move to the Bernabeu appears to have stalled with the clubs failing to agree a fee.
Arsenal boss Arsene Wenger left Reyes out of the Gunners' line-up for their Champions League qualifier second leg against Dinamo Zagreb but he denied it had anything to do with transfer speculation.
The deal with Real hit a stumbling block with Arsenal believed to want £16m for the winger or Julio Baptista to move to the club as part of any deal.
Atletico president Enrique Cerezo had earlier confirmed his club's firm interest in Reyes.
He stated that Atletico had lodged "an important offer" for Reyes and denied his club would have to offload any players to finance the deal.
Reyes has made no secret of his desire to return to Spain and in particular, Real Madrid.