Nottingham Forest boss Steve Cotterill has confirmed the club have received an offer from Leicester City for Wes Morgan.
Sky Sports reported on Thursday that Leicester were lining up a move for the experienced central defender.
And Forest have revealed their local rivals have tabled an undisclosed bid for the 27-year-old, who is out of contract in the summer.
Although Morgan could then leave the City Ground on a free transfer, Cotterill insists Forest will be holding out of an improved bid this month.
"There has been a bid but whether we think the bid is sufficient and sell him or not is another issue," he told the club's official website.
"What we can't have is another player walking out of the club for nothing and that could happen.
"It's not like we can afford to let a player go out of contract and not get any money for him now because the circumstances at the club are different.
"It's something the board are going to look at but I wouldn't see the bid that has been made at this moment being acceptable."
Morgan, who has spent his entire career with his hometown club, has been sidelined since December 10 due to an ankle ligament problem.
However, he trained on Thursday as Cotterill's squad stepped up their preparations for Saturday's trip to West Ham.