Carlo Ancelotti has asked to leave his position as Paris Saint-Germain manager as he wishes to join Real Madrid, but the Ligue 1 champions are determined to keep him at the club.
Ancelotti, 53, has been strongly linked with a move to Madrid in recent weeks, with the Italian tipped to replace current Los Blancos coach Jose Mourinho.
"Carlo has asked to go to Madrid, but we want him to stay," Leonardo said. "No decision has been taken. We've listened to Carlo. We have to look at things a bit. The priority is for him to stay. We've never contacted other coaches."
The Italian confirmed on Sunday that he is keen to take up a new challenge away from PSG, but refused to be drawn on the claim that he has a switch to the Bernabeu in his sights.
"We had a meeting with the president and Leonardo, I asked, because I have a contract, to leave the club," Ancelotti told French TV channel Canal+ at the French Professional Footballers' Union (UNFP) awards ceremony on Sunday night. "We have to wait for the response of the club, which is going to decide its future and mine.
"Madrid is a possibility, but I have a year on my contract. It's the club which will decide. We have to decide together because my decision is to quit the club. It's not easy because I have a very good relationship with everyone. It's not the moment to explain why I want to leave the club and perhaps I'll never explain it."
PSG's Ligue 1 title win means Ancelotti saw his contract, originally due to expire in June, extended by a year and club president Nasser Al-Khelaifi has expressed his wish to keep the former Chelsea boss despite his desire to leave Paris.
"Yes, we had discussions, he asked to depart for Real Madrid,'' Al Khelaifi told beinsport.fr. "I said it is not possible because he has a contract for one year more, so that is our decision.
"It is his problem, it is not our problem. We have offered him another year more on his contract as well as the one he has. When you have a contract, everyone is normally obliged to honour that.''
Ancelotti led the Parisian club to their first Ligue 1 title in 19 years this season and also helped them to the Champions League quarter-finals, where they were eliminated by Barcelona.