Pep Guardiola is a keen admirer of Grealish, describing his as 'one of the best players in the league' before City faced Villa in the Carabao Cup final earlier this season.
Villa are deep in relegation trouble with club captain Jack Grealish expected to leave his boyhood club regardless of whether they manage to salvage their Premier League status.
United head the queue for his services but a rival bid from City would make it harder to seal the deal - especially if they don't secure a place in next season's Champions League.
But City's interest is dependent on Bayern Munich increasing their bid for wantaway winger Sane, report The Telegraph.
The German has made his desire to leave the Etihad clear, with Guardiola confirming as much since football's restart.
He is out contract next summer but City see Bayern's current valuation of £35million 'derisory', and are willing to let him leave for free in 12 months time than for less than market value now.
Bayern would need to up their offer to around £50million, which would allegedly then see City make a play for Grealish.
The 24-year-old can operate either from the wide area or from the middle of the pitch, making him an interesting prospect for Guardiola with City legend David Silva calling time on his stint at the Etihad at the end of the current campaign.
Grealish would also help City's homegrown quota, something United have no such concerns over given the arrivals of Harry Maguire, Aaron Wan-Bissaka and Daniel James last summer.
England under-21 international Grealish was in Gareth Southgate's thinking for the Three Lions's Euro 2020 squad before the coronavirus pandemic brought a shuddering halt to football.
Before the enforced mid-season break, Grealish scored 9 goals in 29 starts, but Villa have picked up just two points since the restart, leaving them 19th in the Premier League table.
#CITYZENS
Saif
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