The report says that Real boss Zidane is a huge fan of Coutinho and would love to bring him to the Spanish capital.
Zidane has also told Madrid’s chairman Florentino Perez that Coutinho is the top item on his wish-list in the transfer market.
There is a silver lining, though, for Liverpool fans. Madrid are currently embargoed in the transfer market until 2018, which means there will be no bids from Real for their star man for some time.
However, if Coutinho is still a Liverpool player in 2018 then Real Madrid could be one of the first clubs to make an enquiry.
Zidane is looking to replace James Rodriguez – who has fallen out of favour during his tenure – and sees Coutinho as the ideal man to come in and take the mantle.