The 25-year-old has been a Chelsea target since last summer and they were thought to have been planning a bid for him this month.
With Branislav Ivanovic on the verge of leaving for Zenit St Petersburg and John Terry's contract expiring at the end of the season, Antonio Conte may look for defensive reinforcements.
However, according to WhoScored.com, Arsenal have stepped ahead after agreeing personal terms with Manolas.
Kostas Manolas has built a strong reputation in Italy during his three years with Roma
Arsene Wenger has a similar problem to Conte in that his central defenders are ageing
A new contract was expected to have been signed at Roma during the first half of the campaign, but no agreement was reached.
Arsene Wenger has a similar problem to Conte in that his central defenders are ageing in the form of Per Mertesacker, 32, and even Laurent Koscielny, 31.
Despite suggestions Roma may look to sell before tomorrow's deadline, the Serie A giants are unwilling to lose Manolas mid-season with a title charge ongoing.
Chelsea and Arsenal squads enjoy team meals out, but where is Mesut Ozil?
Wed, January 25, 2017
Chelsea and Arsenal both enjoyed team meals out ahead of their FA Cup games this weekend, but Mesut Ozil was mysteriously absent from the Gunners' dinner
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Chelsea and Arsenal both enjoyed team meals out on Tuesday evening
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But, the report outlines a sale will be authorised in the summer which would allow the Greece international to join Arsenal for a hefty £47million.
Wenger bolstered his defence last summer with the capture of Shkodran Mustafi, who has impressed greatly since arriving for £35m from Valencia.
And the 24-year-old could form a long-term defensive partnership with Manolas from next term at the Emirates.