The Belgium international has impressed on loan at Leicester City during the second half of this season.
The Foxes do not have a buy-on clause with the 21-year-old's parent club Monaco, and Merson thinks the Gunners should swoop in with an offer.
Asked whether a bigger club than Leicester could try to land Tielemans, Merson said: "I think so.
"I think he's special, I really do, I think this kid is a top, top player. The only thing is he's been working with Brendan [Rodgers] for the last couple of months.
"Surely they're getting into his ear about signing – they've got to get his lad signed. I think he can go to any of the top four, or top six.
"If I was Arsenal or Man United, I'd be looking at him all day long, all day long. Even Man City should be looking, I think he's that good. He's only young, 21. Wow."