Liverpool were only prepared to pay half of Norwich's valuation for the player and submitted a bid worth just £8million - which was immediately rejected.
The Eastern Daily Press says the Canaries were willing to negotiate a deal and expected to receive an improved bid only for Liverpool to instead announce the signing of Kostas Tsimikas from Olympiacos just days later.
Lewis reportedly even returned home early from a holiday in hope of sealing his 'dream' move to Anfield.
The same report states that Lewis and his agent were surprised by Liverpool's modest offer for him and subsequent failure to make a second bid.
Norwich share a good relationship with Liverpool with their sporting director Stuart Webber and fellow executive committee member Zoe Ward previously working on Merseyside and so were disappointed by the way things panned out.