Although the academy graduate enjoyed the best season of his career in 2023-24, there has been constant speculation regarding his future.
With just one year remaining on his contract, Chelsea co-owners Todd Boehly and Clearlake Capital have been pushing to sell the England international.
While Gallagher would prefer to remain at Stamford Bridge, it has become increasingly apparent that a sale looks more likely than another 12 months with the Blues.
A fee of £30m was spent on Kiernan Dewsbury-Hall, who has joined Enzo Maresca in leaving Leicester City for Chelsea, while Romeo Lavia is being reintegrated back into the squad after a season on the sidelines.
Atletico ready to push for Gallagher
At one point, the suggestion had been that the 24-year-old's preference was to remain in London, despite interest from new Champions League participants Aston Villa.
However, during his time with England at Euro 2024, it has been suggested that Gallagher has spoken to former Atletico defender Kieran Trippier regarding a potential switch to Spain.
According to TEAMtalk, Atletico have been left 'extremely confident' that they will be able to get a deal over the line for Gallagher.
The report claims that the La Liga outfit have instigated discussions with Chelsea and are now regarded as the frontrunners for his signature.
Gallagher is allegedly deemed to be the ideal fit for Diego Simeone's system at Civitas Metropolitano, the likelihood being that he would become a first-choice pick in the engine room.
What fee could be paid?
That is yet to be determined. Chelsea allegedly want somewhere in the region of £40m, whereas a previous report has indicated that Atletico initially bid £17m.
Despite the respective parties being far apart, a compromise is expected to be agreeable at some stage of negotiations to suit their own needs.
Chelsea cannot afford to lose Gallagher on a free transfer in 2025, while Atletico require a new centre-midfielder after the departure of Saul Niguez to Sevilla.
The two clubs are no strangers to conducting business with Saul having spent time at Chelsea in the past and Cesar Azpilicueta having moved to Atletico last summer.