Intermediaries across Europe have been informed that Ceballos is unsettled in Madrid, just months after his summer arrival from Real Betis.
The midfielder, outstanding for Spain in the U21 Euros, was expecting regular action at Real, but has barely made an appearance and believes coach Zinedine Zidane never actually requested his signing.
Ceballos is now open to leaving Real and Don Balon says his camp has received enquiries from Arsenal.
Gunners boss Wenger sees Ceballos as a potential replacement for Mesut Ozil, who is expected to leave as his contract runs down. Wenger can offer Ceballos regular football on a stage similar to Real and the young midfielder is receptive to the prospect.