The coach believes his team’s slow start to the season is a result of players gelling with each other and says Gareth Bale could return against Malaga
Since leaving the Santiago Bernabeu on deadline day this summer, the Germany international has helped Arsenal reach the top of the Premier League and Champions League Group F - scoring once and adding five assists in five appearances.
Madrid, on the other hand, have struggled this season to keep pace with Barcelona and Atletico Madrid, but Ancelotti is not concerned with his side's attacking output without the German playmaker at the Blancos.
"I don’t regret Ozil leaving," the 54-year-old told reporters. "I wish him luck but we don’t need him as we’re doing fine in attack without him.
"We’re scoring a lot of goals, but we need to find balance as we are conceding too many. We need to get the team to gel."
The team will also receive a boost when Gareth Bale returns from injury following the international break, although the Italian reiterated the €100 million man is unsettled by his lack of fitness at the moment.
Ancelotti added: "He’ll stay here [in Madrid] to train for 15 days and he will be ready for our next game [against Malaga on October 19].
"He’s not too happy as he was excited about being able to play. He’s been through a difficult time, but psychologically he is fine.
"He is a relaxed guy and his fitness problems are not serious."
Real Madrid will travel to Levante on Saturday, where they have won just once in their previous four visits, and Jose Mourinho's successor knows that a top performance could be needed from his players to come away with a triumph.
"They are a difficult team to face, particularly at home," Ancelotti continued. "Madrid struggled there last season. We have to be focused and put in an intense game.
"Against Levante, a few players who didn’t start against Copenhagen will get to play. It’s possible that Alvaro Morata will be in the line-up."