Chelsea's 3-1 win over Arsenal at the weekend has left the Gunners a mountain to climb.
The league leaders are currently 12 points ahead of Arsene Wenger's side with just 14 games left of the season.
But Mustafi admits Arsenal will not give up on the title until it is mathematically impossible.
Shkodran Mustafi is a 'believer' that Arsenal can still challenge for the title
Arsenal are 12 points adrift of Chelsea at the top of the table
"I think it's going to be more difficult than it was before but I'm a believer," Mustafi told Sky Sports. "I don't give up.
"As long as it's possible we're going to fight for it, and in the end we will see and if we're lucky enough and good enough to go for it or not.
"The first game we lost at home [to Watford] was really disappointing. We woke up a bit late, conceded two quick goals and it was difficult to come back.
Fans reflect on Arsenal's woeful defeat to Chelsea
Sat, February 4, 2017
Express Sport brings you the best tweets as Arsenal fans reflect in their woeful defeat to Chelsea on Saturday
1 of 10
Arsenal fans reflect in their woeful defeat to Chelsea on Saturday
"We were disappointed as well with losing at Chelsea, which was a completely different game.
"We knew it would be difficult at Stamford Bridge, but we knew as well it's possible to win. I think in the end we didn't do enough."