The Blancos midfielder believes his side are in a good position to secure la Decima this term but is aware that the first hurdle - the group stages - will be difficult to overcome
Los Blancos were eliminated by Borussia Dortmund in the semi-finals of the tournament last term and have gone 11 years without lifting the European trophy.
But the youngster is confident the club are in a better postition to secure the long-awaited Decima this term, especially after their summer outlay.
"Real Madrid are favourites for the Champions League trophy," the 21-year-old told reporters at a press conference.
"It shouldn't become an obsession but we will give everything for la Decima."
Coach Carlo Ancelotti recently faced criticism for letting Mesut Ozil leave for Arsenal but Isco is convinced the club's new signings easily make up for the loss of the valuable assist creator, particularly after the recruitment of world-record signing Gareth Bale.
"After Mesut Ozil's departure, not much has changed. Now we have Gareth Bale and we are tyring to help him.
"With new additions this summer, we can clinch the title this season."
The former Malaga man then revealed that his side are aware of the atmosphere awaiting them in Istanbul and singled out Wesley Sneijder and Didier Drogba as possible threats.
"Galatasaray have important players and some passionate fans. We are aware of that. We will do our best and try to win this match," Isco added.
"I know Wesley Sneijder and Didier Drogba well. We will do everything we can to stop them. We prepared well for this encounter."
Real will lock horns with Fatih Terim's men on Tuesday at the Turk Telekom Arena.