The 17-year-old seems likely to leave the Etihad after reportedly failing to turn up to training for weeks.
It was believed he wanted a return to home city London, with Arsenal in the hot seat to sign the talented youngster.
But The Mirror is reporting Spurs are looking to sneak in with a £3m offer and hijack the deal.
The club can also boast working under manager Mauricio Pochettino, who has gained a reputation for his willingness to promote youth players.
He has seen several of the players he has worked with make their England debuts as a result.
Video of Sancho in action for England under-17s at the European Championship this summer shows why he is so highly regarded.
The clip shows how he set up team-mate Rhian Brewster with a sensational run.
Sancho first shows his speed to accelerate away from defenders before using his ball skills to round the keeper.
He then has the presence of mind to square it for a simple tap-in.
Man City fans have expressed their dismay at his departure.
“Fee should be around 3-4m which will be absolute steal for you lads,” wrote one on Reddit.
Another added: “Congrats on the signing guys, should be official soon. He's an absolute gem!”
