The Gunners have already recruited a goalkeeper this summer after they converted David Raya's loan move into a permanent stay.
While Raya is Arsenal's undisputed number one, the Gunners are in the market for a new goalkeeper before Friday's transfer deadline.
The North London club are looking for a replacement for Aaron Ramsdale, who is set to depart in search of regular game time.
Ramsdale has found playing time hard to come by after losing his number-one spot to Raya in the opening stages of last season.
Arsenal suffer Garcia setback
Southampton are believed to be working on a deal to sign Ramsdale after their proposed move for Feyenoord's Justin Bijlow fell through due to an issue in the player's medical.
Ramsdale is also a potential target for Ajax, while Wolverhampton Wanderers were previously linked with the Arsenal man before they turned their focus to Crystal Palace's Sam Johnstone.
With Arsenal preparing for Ramsdale's departure, they are seemingly keen to sign Espanyol's Garcia as Raya's new understudy.
It has been reported that Arsenal have already reached an agreement over personal terms with the Spanish shot-stopper.
However, their hopes of singing Garcia have been dealt a blow by Espanyol boss Gonzalez, who is keen to retain the goalkeeper's services.
"He is a very good goalkeeper, I am calm when he plays," Gonzalez recently told reporters. "I don't know about the transfer market, although I hope he doesn't leave.
"What the club tells me is that he should not leave unless a club comes and nothing can be done. He is a great goalkeeper, but the level of the goalkeepers I have is very high."
Who is Arsenal's transfer target?
The 23-year-old has made 31 senior appearances for Espanyol after progressing his way through the club's youth ranks.
Garcia started last season as Espanyol's second-choice goalkeeper before he established himself as the number-one shot-stopper in March.
He went on to make 18 appearances across the regular season and the Segunda Division playoffs, helping Espanyol win promotion back to La Liga.
After being part of the Spain squad that won gold at the 2024 Olympics, Garcia has returned to Espanyol to feature in the first two matches of the new season.