The Gunners were heavily linked with a swoop for the 20-year-old midfielder, who has scored 13 goals in 82 Bundesliga games for Schalke, over the summer.
The north London side are understood to have pondered a deadline-day move for the youngster, but Schalke were not prepared to listen to offers.
Schalke were reported to value Draxler, who has seven Germany caps to his name, at around £40m, before Arsenal made a swoop for his compatriot Mesut Ozil instead.
And Schalke general manager Horst Heldt is confident that the Draxler will not be leaving the club in the winter transfer window.
“We will retain Draxler,” said Heldt. “There will be no dramas this winter.”
Heldt’s comments come after the player himself insisted he was pleased with his decision to turn town a move to the Premier League in favour of staying in Germany.
“The World Cup’s at the end of the season and you always need time to get used to a new team,” Draxler, who has also been linked with Chelsea, said last month.
“It was not an easy decision. You never know whether you will ever get such an offer again.
“In the end, I followed my heart and decided to remain at Schalke. On top of that, I’m convinced I’m at the right club with Schalke.”
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