The future of Sterling appears uncertain as the winger nears the end of his two-year contract with the Premier League leaders, without a renewal in place.
According to the 'Daily Mirror', this has caused Madrid to come out of the woodwork as they sound out a potential move for the 23-year-old, with head coach Zinedine Zidan a reported admirer of the Englishman's talents.
Sterling is experiencing one of his best seasons in his career so far, becoming a key player for Pep Guardiola by netting 20 goals already in all competitions - 15 of which have come in the Premier League.
The interest follows reports in Spain that have suggested that Gareth Bale is up for sale after failing to reach great heights this campaign for 'Los Blancos', due to a multitude of injuries which have caused patience to wear thin in Madrid.
Sterling would be an ideal replacement on the wing and is arguably one of England's best talents going into the World Cup in the summer.
Therefore, if City don't offer him enough money to bring him to the same level of his Premier League's opposition stars, a move to the Bernabeu could prove too difficult to resist.