The 48-year-old is growing in confidence that his side are capable of winning the competition ahead of Friday's quarter-final draw
The Ligue 1 champions booked their place in the quarter-finals of the competition after beating Bayern Leverkusen over two legs in the last 16 and will learn of their last eight opponents at Friday's draw in Nyon.
"In the Champions League there are only great teams to play," said Blanc. "Real Madrid are in great form right now but so are many other sides.
"Our project is still under construction but our ambition is to win the Champions League."
The key to much of PSG's success has been the continued brilliance of star man Zlatan Ibrahimovic, who has already scored 40 goals this season in all competitions.
And Blanc was quick to praise the 32-year-old for his ability to influence games and seize responsibility for deciding games time and again.
"Ibrahimovic scored a lot of goals at his previous clubs but the system we play here really suits him," said the former France coach.
"He is able to influence and guide a game and get on top of it. He is often the decisive factor."
PSG face Lorient on Friday night as they bid to extend their eight-point lead at the top of Ligue 1 and close in on a second successive title.