Los Blancos had appeared to be on the brink of signing the World Cup winner until it was announced on Saturday that he would be remaining at Paris Saint-Germain.
The Spanish giants will now use funds which had been set aside for Mbappe's lucrative contract to sign at least one different option, with numerous high-profile players currently being linked with a switch to the Santiago Bernabeu.
According to the Daily Star, the La Liga champions could make a formal approach for Sterling, who has just one year remaining on his contract at the Etihad Stadium.
Despite contributing 16 goals and seven assists in Premier League and Champions League fixtures this season, the 27-year-old has not always found himself first choice under Pep Guardiola.
The report suggests that a £50m deal may suit all parties, although it would be a surprise if Real do not attempt to lower that fee given the England international's contract situation. body check tags ::