The 19-year-old midfielder is a product of the Manchester City academy and has scored 26 times in 46 Premier League 2 appearances for their Under-23 side.
The Premier League champions are believed to be interested in loaning him out to give him an experience of regular first-team football.
He has been linked with a move to Scotland where Rangers were believed to be interested in signing McAtee this summer.
But it has been claimed that Rangers are not considering making a move for the 19-year-old attacking midfielder in the ongoing transfer window.
Rangers boss Giovanni van Bronckhorst knows the player from his time with the City Football Group.
There was previous interest from Rangers but the club are not pursuing the midfielder’s signature this summer.
The Rangers boss is believed to be keen to add more experience to his squad in order to challenge Celtic for the title next season and again enjoy a lengthy European run.