Salah has made a flying start to life at Anfield this season, repaying the club-record fee, an initial €42 million that could rise to €50m, Liverpool parted with to recruit him from Roma by netting 19 goals in 25 matches.
Madrid did not reinforce their attack in the close-season and have struggled to achieve their usual potency, with Gareth Bale battling injury and Cristiano Ronaldo and Karim Benzema lacking form.
Reports this week have credited Los Blancos with an interest in Salah as the January transfer window approaches.
And, asked by an Egyptian journalist at the Club World Cup about the 25-year-old, Zidane said: "Salah is a great player, [he has] shown that at Roma, now Liverpool.
"He is still young, improving all the time. I don't talk much about other players, but he is a player I rate a lot."
The French coach was also called on to defend his compatriot Benzema, whose struggles have been seized on by the unforgiving Spanish media.
"I don't agree with the way he's been criticised," Zidane said.
"What's important for me is not only goals. Karim is a different player; he won't score 50, 60 goals but he's scored a lot of goals in our shirt.
"For me, Karim is one of the best in this sense as a team player.
"I defend him to the death because he is not only one who could have problems."