Ollie Watkins would be open to joining Arsenal this month but Aston Villa are determined to keep the England international.
Mail Sport revealed on Wednesday that the Gunners had an offer for Watkins rejected after receiving encouragement that a successful swoop was possible.
Arsenal, on Thursday, still had not given up hope of landing the 29-year-old despite the understanding that Villa will not consider selling Watkins and his strike partner Jhon Duran in the same window.
Duran is close to joining Saudi Pro League club Al Nassr.
Arsenal are now weighing up a second offer in hope of reviving the deal but if Duran completes his switch to the Middle East it appears highly unlikely that a renewed bid would be successful.