The Spaniard is looking likely to leave the 'Reds' at the end of the campaign and having lost his place in the side to the impressive Andy Robertson it is unlikely he will sign a new deal to play second fiddle to the Scot for the forseeable future.
His potential availability on a free has alerted a host of sides in his homeland, including former club Sevilla and heavyweight pair Real Madrid and Barcelona, but according to the 'Daily Mail', Arsenal are interested in giving him another chance to prove his worth in the Premier League.
The 26-year-old worked under 'Gunners' boss Unai Emery during his time with Sevilla, with the pair thought to share a strong working relationship.
Nacho Monreal is currently Arsenal's first-choice left-back, but with him set to turn 33 by the end of the season and fellow defender Sead Kolasinac suffering regular injuries Arsenal are thought to be looking into the possiblility of bringing in fresh blood in the position.
Moreno has made just one appearance for Liverpool so far this season, starting their EFL Cup defeat to Chelsea back in September.