The 21-year-old excelled for the Foxes during the 2020-21 campaign but is yet to play this term, having suffered a serious leg injury during a pre-season clash in August.
Fofana has a contract at the King Power Stadium until June 2025, but there have been suggestions that a number of leading European clubs are keen on securing his services.
According to Marca, Real Madrid have identified the Frenchman as a leading transfer target, as the Spanish giants prepare for the future.
Fofana made 38 appearances for Leicester last term, helping Brendan Rodgers's side win the FA Cup, in addition to securing a fifth-place finish in the Premier League.
Rodgers recently revealed that the defender was on course to return to full training in February, having made excellent progress in his recovery from the serious injury.