Real Madrid president Florentino Perez confirmed on Spanish radio on Thursday morning that Portuguese central defender Pepe is "not for sale" this summer.
"Pepe is not for sale. He will not leave this summer, not in my opinion anyway," Perez told Onda Cero radio.
"He is one of the best defenders in the world. It is very difficult to find someone like him."
The 30-year-old Brazilian-born Portuguese international had a difficult time last season at the Santiago Bernabeu under Jose Mourinho, losing his place in the team to young Frenchman Raphael Varane.
He is still under contract in the Spanish capital until June 2016, although Manchester City had been linked with a 25 million-euro ($32.8m) bid for the player by Spanish media.
One Portuguese international centre-back has already left Madrid this summer, with veteran Ricardo Carvalho moving to Monaco on a one-year deal.