The striker, who has been linked numerous moves away from the club, says he is "fine" in the Spanish capital and believes his lack of action could help Uruguay in Copa America
The 32-year-old had a poor season by his high standards, scoring just eight times in 32 Liga appearances while losing his place in the team towards the end of the campaign.
He has been repeatedly linked with clubs such as Tottenham Hotspur, Juventus, Al-Wasl and Besiktas.
However, an interview with El Observador, Forlan talked about his future and stated he is happy to stay in Madrid.
Asked about a possible move to Diego Maradona's Al-Wasl, he replied: "I suppose so, but everyday they [the press] put me with another club.
"Right now there is no offer, but I have two years left on my contract, I'm fine here, I bought a house here four years ago, and Madrid is a great city. [Atletico Madrid are] a good team, and it'd have to be a very good offer for me to consider changing clubs."
He also discussed the upcoming Copa America, where he feels his removal from his club side's line-up will prove beneficial for his performance for Uruguay this summer.
"I've been playing more than 60 games for each of the last six or seven years now," he explained. "[My situation at Atletico] came in handy because I rested and got ready for the Copa America.
"We have an established selection of players, a good group, and there are replacement players. However, we must bear in mind that other teams will be very good, and things could go very wrong if we're not careful."