The Arsenal boss has suggested that Diego Simeone's men can be the surprise package in the Champions League and thinks at least 10 teams could win it.
Jurgen Klopp's men knocked out the likes of Manchester City, Shakhtar Donetsk and Real Madrid en route to a 1-0 final defeat at Wembley to Bayern Munich last May, earning no shortage of plaudits with their underdogs tag.
Atletico has started its European campaign this season with two wins to add to its perfect eight out of eight mark in La Liga, and Wenger believes Atleti coach Diego Simeone can take the Rojiblancos far in this year's tournament.
"Atletico Madrid can be one of the surprises of the Champions League," Wenger told Eurosport. "They can repeat what was does last year by Borussia Dortmund. They're a very good team with a lot of quality in every area of the pitch.
"They have many good players - especially Diego Costa, who is a top predator and can score from any position."
Wenger's Gunners face BVB in Group F this year alongside Napoli and Marseille, and he thinks that the quality of the competition is increasing, with 10 or more teams vying for the coveted trophy.
"In the past, during the first years of the Champions League, as coaches we only expected three or four teams to potentially win," Wenger said. "Now at least 10 teams can dream about victory in the main competition. Now, in October, it is literally impossible to say who is going to be the successors to Bayern."
Despite the multiple candidates to win, Wenger is still impressed by what Bayern has accomplished thus far this season and thinks that the Bavarians are the overall favorites and have a great shot at repeating.
"It was an impressive victory for Bayern against Manchester City," Wenger said. "That game in particular I watched and studied and for me, Bayern are already the favorites in this competition. All other teams have got one goal: and that is to beat them and deny them. They are a team that can go on and win again.