The Brazilian-born forward – who was linked with Liverpool over the summer – has emerged as one of European football’s most sought-after talents this season, with his consistent displays helping his club side to establish themselves as title contenders in Spain.
With 22 goals in all competitions already this term, Costa has been attracting much attention from top sides in recent months, with Arsenal believed to be among the chasing pack.
The Gunners have had scouts watching the 25-year-old, and his performances have been of sufficient quality to persuade Arsene Wenger to turn to him instead of Liverpool’s Luis Suarez.
Costa only penned a new contract with Atletico a matter of months ago, but the London club could activate a £32m buyout clause to enter discussions.
Wenger was linked with Gonzalo Higuain during the last window, but was unable to snap up the Argentine who instead joined Napoli.
Olivier Giroud remains the club’s only top class centre-forward, which is a source of concern for the Emirates Stadium side.