The 2016 PFA player of the year Mahrez is wanted by Serie A outfit Roma, who are offering the Algerian Champions League football.
With Mahrez keen to go, Leicester are aware it is vital they secure Gray as rival Premier League clubs eye the wideman.
New permanent Leicester boss Craig Shakespeare tried earlier this month to reassure in-demand Gray about his first team prospects at the former champions.
The starlet made only nine League starts last term and is a target for Premier League clubs including Spurs, Liverpool and Everton.
They are dangling big tempting pay-rises for Gray, who earns £25,000-a-week at the King Power after joining from Championship Birmingham in January 2016 for £3.5million on a deal until 2020.
It means there is a huge disparity between Gray’s salary and the club’s senior players like Jamie Vardy on £100,000 a week.
But Leicester and Shakespeare are desperate to keep hold of Gray with the Foxes chief saying: “He’s a player of huge potential who is rated very highly here among the coaching staff and his own players.”
Unlike N’Golo Kante who quit last summer, Gray does not have a buy-out clause and MirrorSport understands Leicester are now willing to give him a new deal with a hefty pay-rise.
The Foxes recognise their need to keep one of the Premier League’s best youngsters and that his salary needs improving.
Gray’s stock improved with England’s U21s this summer at the Euros after two goals in Aidy Boothroyd’s side’s run to the last four.
But as well as a better contract, Gray also wants more game-time after admitting he found last season “very…