Liverpool have been long-term admirers of the 21-year-old but their interest has reportedly cooled this season.
But Dahoud is not short of interest from some of Europe's elite clubs with Juventus, Paris-Saint Germain and Borussia Dortmund all rumoured to be monitoring his situation.
Mahmoud Dahoud's representatives have reportedly held talks with Chelsea in recent weeks
Antonio Conte wants to bolster his midfield options this summer
The report claims Dahoud's representatives have held talks with Chelsea in recent weeks along with other clubs to negotiate a transfer this summer.
Reports in Germany had suggested Dortmund had beaten their competition to the signature of Dahoud for £8.5million.
But the Guardian believe no deal has been struck, leaving Chelsea in a position to continue negotiations.
Chelsea predicted team to face Wolves in FA Cup
Thu, February 16, 2017
Express Sport brings you Chelsea's predicted team to face Wolves in the FA Cup Fifth round this weekend
Chelsea FC via Getty Images
1 of 12
Who could Antonio Conte start against Wolves in the FA Cup?
Franck Kessie has been linked with a move to Chelsea in recent months
Antonio Conte is hopeful off adding more depth to his midfield this summer to provide back-up to N'Golo Kante and Nemanja Matic.
Chelsea have also made enquires for Atalanta star Franck Kessie but Dahoud could be available for half the price.