According to talkSPORT, the 25-year-old England centre-back has emerged as a leading target for Pep Guardiola after the Citizens were hit by a defensive injury crisis, with Ruben Dias, 28, sidelined for up to six weeks and Josko Gvardiol, 23, potentially out for the season following a broken leg.
City’s need for reinforcements has intensified with John Stones, 31, also unavailable, leaving Guardiola short of senior options at the back and prompting the club to explore the January market despite Guehi being out of contract in the summer.
Speaking to reporters, Crystal Palace manager Oliver Glasner said: “If a player feels too good for a club, it is better to sell him, and if a player is not good enough for a club, you also have to sell him. To get the best out of your squad, it must be a match.”
Guehi, who joined Palace from Chelsea in 2021 after impressing on loan at Swansea City, is understood to be content to see out the season at Selhurst Park.
Sources close to the situation have suggested he values regular minutes under Glasner as key to cementing his place in England’s plans ahead of the 2026 World Cup.
Glasner acknowledged City’s interest could change the landscape quickly if a significant offer arrives.
He said: “It could be [a match]. I’m not so naive as not to know that if a massive offer comes from City and Marc wants to do it, it will happen.”
Palace are believed to be open to a mid-season sale given the risk of losing Guehi for free in June, though his valuation remains a sticking point.
Liverpool came close to signing him on deadline day last summer, while Bayern Munich, Real Madrid and Barcelona have all tracked his situation, with overseas clubs able to agree a pre-contract this month.
Glasner added: “Everybody wants him to play for Crystal Palace, sign a new contract and stay here for ever. On the other side, the contract ends this summer and if somebody is coming and the money is above the threshold, it will happen.”
Reports have suggested City could be willing to pay a reduced January fee to secure Guehi immediately, potentially moving ahead of domestic rivals who may prefer a free transfer.
Arsenal and Liverpool are reportedly among those monitoring developments but are not thought to be prepared to meet Palace’s demands this window.