The Liverpool captain, who turned 30 at the end of last month, has been named as the main man that JosÃƒÂ© Mourinho wants to bring to the Spanish capital, according to Spanish newspaper Marca.
The Portuguese boss believes that the current chaos at Anfield will be enough to convince Gerrard head to Madrid along with a number of other experienced stars.
Despite having three-and-a-half years left on his Liverpool contract Gerrard has failed to confirm he will be at Anfield next season, stating that he will make no decisions on his future until after he returns from South Africa.
Anfield experts have also suggested that Fernando Torres may be ready to leave the troubled club, with Chelsea manager Carlo Ancelotti preparing to up his efforts to bring the Spanish forward to Stamford Bridge.
With Barcelona expected to renew their interest in Argentine international Javier Mascherano, the Merseyside club could be looking at losing three of their star performers over the course of the summer transfer window.
Meanwhile Liverpool have agreed a severance package with manager Rafael BenÃƒÂtez, who is now expected to take the place of Mourinho at current European Champions Inter Milan.
Names currently being linked to the position include Martin OÃ¢â‚¬â„¢Neill, Roy Hodgson and Mark Hughes, but for a number of reasons including LiverpoolÃ¢â‚¬â„¢s financial troubles it looks unlikely any of the trio will take the vacant managerial role at Anfield.
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