The Polish striker has been linked with the La Liga giants for some time, as the player supposedly turned down three other major European clubs in the hope that he would be able to move to the Spanish side.
But, according to Italian news outlet La Republicca via CalcioMercato, Real Madrid's president presented another twist in the tale and is now reportedly uninterested in signing the player from Bayern Munich.
This will be another major blow to Lewandowski, who has recently been eliminated from the World Cup with the Polish national team after failing to qualify from Group H.
The Munich man has scored an impressive 41 goals in 48 games for his club this season, helping the Bavarian side win the league by an incredible 21 points and making it to the semi-finals of the Champions League, losing out to eventual champions Real Madrid.
Chelsea are yet to make a signing this summer, however Manchester United have already made two new acquisitions, signing Brazilian midfielder Fred from Shaktar Donetsk and Portuguese defender Diogo Dalot from Porto.
It is unclear how Lewandowski would fit into the Red Devils team, as their current striker Romelu Lukaku is in great form at the World Cup, having scored four goals in two appearances.