The 25-year-old defender is no longer a certainty in the West Ham team and has started just one league game for the Hammers since mid-January.
Diop is no longer a first-choice centre-back at West Ham and that has led to speculation over his future at the club ahead of the summer window.
The defender is expected to consider offers to leave West Ham in the summer as he wants to play regular first-team football next season.
And according to French sports daily L’Equipe, Lyon have identified him as a top target for the upcoming window.
Lyon want to bring in a younger centre-back at the end of the season as part of their recruitment plans.
Diop is being considered a serious option and Lyon are set to make a move for him in the summer.
The defender has a year left on his contract, but West Ham have the option to extend it by one more year.
David Moyes is also unlikely to want to lose a defender without bringing in a replacement for him.
