Arsenal contacted premier league rivals Leeds earlier this month to express interest in Kewell.
"If Harry wants Champions League football, then he is aware of this official interest from Arsenal and he will no doubt pursue that," Leeds chairman John McKenzie told British newspapers on Tuesday.
Kewell, 24, has one season remaining on his contract with Leeds, who are struggling financially and finished 15th
In contrast, Arsenal finished second in the premier league and retained the FA Cup.
McKenzie said Leeds had made Kewell a "very good (contract) offer" but understood that the player wanted to assess his options.
"He has heard what we have got to say," McKenzie told British newspapers on Tuesday. "We have done all we can for Harry and we have made what we consider to be a very good offer.
"If Harry decides that offer is not good enough and he does not want to play for Leeds then that is his option. Harry wants to assess his various options and there is nothing more we can do until he has done that."