Fekir was said to be on the verge of joining Liverpool in last summer's transfer window, only for the France international to fail his medical due to concerns over a long-standing knee problem.
The 25-year-old has enjoyed another productive campaign with Les Gones, scoring 12 times and contributing nine assists in 39 appearances in all competitions.
Lyon president Jean-Michel Aulas has confirmed that Fekir can leave Lyon this summer with his current deal expiring at the end of the 2019-20 campaign.
According to The Sun, Liverpool are ready to revive their interest but the Reds will face strong competition from City, who pipped Jurgen Klopp's side to the Premier League title on the final weekend of the season.
Fekir has scored 69 times and contributed 46 assists in 193 appearances for Lyon in all competitions. body check tags ::