Los Blancos are preparing to reinforce in the coming months as Carlo Ancelotti aims to defend his La Liga and Champions League double in 2022/23.
Several big name exits have freed up significant wage resources for Ancelotti as he looks to rebuild his veteran squad.
German international Antonio Rudiger has already agreed a free transfer move to the Spanish capital with Ancelotti pushing hard to seal a deal for AS Monaco star Aurelien Tchouameni.
According to reports from Diario AS, Ancelotti also wants to add an attacking option to his ranks, with Sterling a possible option.
Pep Guardiola has previously hinted at his willingness to allow Sterling to leave the Etihad Staidium with his current contract expiring in 2023.
Erling Haaland is on the verge of joining City and Sterling could push for a move away from Manchester with the Premier League champions open to offers of £60m.