The 21-year-old has been told that he is not yet “good enough” to play for Real Madrid but Arsenal must tie him down to a new contract.
The Gunners pulled off a coup in 2019 as it only cost them around £6m to sign Martinelli from Brazilian side Ituano.
Gabriel Martinelli has already proven to be an astute signing as he is one of the best young players in the Premier League.
Martinelli shone last term as Arsenal mounted a surprise push for the Champions League places.
Arsenal fell short in the end, but Martinelli and Bukayo Saka are among the stars who have spearheaded their superb start to the 2022/23 campaign.
Martinelli, Saka and William Saliba are out of contract in 2024 and it is vital for Arsenal to get them to sign new long-term deals.
Ex-Arsenal captain William Gallas has encouraged his former club to get a contract for Martinelli closed “as soon as possible”.
But the Frenchman has also suggested that if he were to leave, “he’s not ready” to play for a team like Real Madrid.
“I think Arsenal have to get that deal with Martinelli signed as quickly as possible. I’m sure he’s hearing so many things about him, like Real Madrid being interested,” Gallas told Genting Casino.
“Sometimes the player can be confused. At the moment I think he’s playing well and Arsenal have to close that deal as soon as possible so he feels better in his mind.
“I don’t think he’s good enough for Real Madrid yet. In football after two or three games, everyone is raving about that player, ‘he’s magnificent’ or ‘he’s a top-class player’ but no, calm down, let him have a great season to get to another level. He’s still young, he’s only 21.
“But if he goes step-by-step, he can go to a club like Real Madrid but right now he’s not ready.”
Gallas has also pushed Martinelli and Saka to “be consistent” for a few seasons.
“I think Martinelli and Saka are still behind Kevin De Bruyne, for example. To be among the best, it’s not because you played a few good games and then suddenly you belong there.
“You need to be consistent and prove throughout the season that you’re at that level, which is not easy because the Premier League is so competitive. You play almost every three days and top teams play in Europe.
“At the end of the season we will know how good they are, and even then we may need another season.
“Sometimes players can have one great season and everyone is talking about them, and then they can’t do it for the next season. So top-class players are those who can do it almost every season.”