The 19-year-old has long been linked with moves away from his current club, and both Spanish giants have been mentioned when possible destinations have been mooted.
And now Diego, who came through the ranks of the Santos youth academy, has advised Neymar to move to Camp Nou.
"For the way Barcelona play and for his development, I think they would be the best option for him," Diego was quoted as saying by ESPN.
"But he could go to Real Madrid because they always buy the best players. Neymar is a special player with qualities difficult to find. He's different.
"He is well on track and well advised. I would advise that he takes advantage of the remainder of this period to learn from, and listen to, the people who are really his friends. He is very talented and his career is going well, now he just needs to burst onto the world stage."
Neymar has a contract with Santos until August 2015, and the Brazilian side are determined to hold on to the forward for as long as possible.
How do you stay up to date with football when on the move? With http://m.goal.com – your best source for mobile coverage of the beautiful game.