The 25-year-old was heavily linked with a move to the City Ground for several weeks and was also on the radar of Roberto De Zerbi's Marseille earlier in the transfer window.
Nketiah has remained on the periphery of the Gunners' squad since breaking into the senior setup, though he did make 10 Premier League starts in 27 appearances last season.
However, when granted the opportunity to lead the Arsenal attack, his performances were largely underwhelming, managing a tally of just five goals and two assists.
The England international is said to be looking for a move away from the Emirates this summer in search of regular playing time and it seems that he may now get his wish.
Crystal Palace closing in on Nketiah signature
One of the major reasons Nketiah's potential moves this summer have fallen apart is the £30m asking price that the Gunners have set for their academy graduate.
However, The Athletic report that the North Londoners may have found a potential buyer, with Crystal Palace tabling an offer of £25m plus £5m in add-ons to secure the striker's signature.
It is understood that a key to getting the go-ahead from the Gunners is Palace's willingness to accept a sell-on clause be added to the deal.
The Eagles recently saw the experienced Jordan Ayew depart to Leicester City, leaving them with Jean-Philippe Mateta and the out-of-favour Odsonne Edouard as the only recognised strikers in the squad.
Nketiah has scored 38 goals in 168 appearances for Arsenal in all competitions and also registered five goals in 19 games for Leeds United during a loan spell at Elland Road in the first half of the 2019-20 season.
Arsenal to reinvest in new forward?
Having come through the ranks at Arsenal, the sale of the Nketiah, whose contract runs until 2027, will represent pure profit to the club's bottom line.
However, there is a possibility that the Gunners may need to use those funds to sign attacking reinforcements before the transfer window slams shut on Friday.
Mikel Arteta's side suffered a setback last week, with Gabriel Jesus sustaining a groin injury in the lead-up to the side's 2-0 win over Aston Villa at the weekend.
With Jesus potentially facing a stint on the sidelines and Nketiah set to depart, Arsenal will have to rely on Kai Havertz and Leandro Trossard to lead the line, though neither are out-and-out number-nines.
Thus, the Gunners may look to make a late bid for a recognised centre-forward this week and could consider the likes of Viktor Gyokeres and Ivan Toney, who they were linked with earlier this summer.