The Gunners were said to be hopeful of tying up a deal before tonight’s deadline, but negotiations with the midfielder’s club side appear to be stalling.
Arsene Wenger is reluctant to meet the valuation – just north of £30m – which has left an arrangement hanging in the balance.
This has alerted Manchester City, Manchester United and Chelsea, who are all ready to push for moves in six months’ time.
The trio all have the funds to land the 20-year-old ace, which would leave Arsenal battling against the odds for their top target.
Draxler himself is said to be aware of the potential interest at the end of the season, and could be ready to hold off and keep his options open.
Wenger is thought to have put a £17m plus Lukas Podolski offer on the table, but the Bundesliga club are not keen on such a transfer.
The London club may instead turn their attention to a £2.5m deadline day move for Salomon Kalou of Lille.