After a very good start to the season, in which he was frequently compared to fellow Frenchman and ex-Blancos midfielder Claude Makelele, Diarra lost the confidence of coach Manuel Pellegrini, meaning he had fewer minutes and less importance within the team structure.
Thus, Los Blancos will reportedly attempt to sell the midfielder with the hope of cashing in on what could be a significant transfer fee.
Madrid bought Lass as a 2008 winter transfer recruit from Portsmouth and while United are said to be interested, Arsenal are also reportedly tempted to take the player back to the Emirates Stadium where he spent the 2007-08 season.
Diarra was called up to Raymond Domenech's French national team squad yesterday for participation in this summer's World Cup in South Africa.
Become a fan of Goal.com UK's Facebook fan page for all the latest news and insight into everything related to the beautiful game!