Chelsea head coach Enzo Maresca says Conor Gallagher is not training with the main first-team squad and is unavailable to face Manchester City on Sunday.
The England international, 24, was pictured in Atletico Madrid’s Metropolitano Stadium after Chelsea accepted a £33m bid from the Spanish club.
But he has been unable to complete his move after a deal for striker Samu Omorodion to go in the opposite direction collapsed, leaving Atletico without the funds to sign the midfielder.
Chelsea are now trying to sign forward Joao Felix from the Spanish club but Gallagher has been recalled to London and is training in a separate group at their Cobham training ground.
When asked about the situation, Maresca said: “Conor is back and training a bit apart, he is doing some medical tests and training, he won’t be involved in this game.
“You know better than me that he is trying to find a solution with the club and we will see what happens.
“Hopefully Conor’s situation finishes with the player, the club and all the people happy.”
Maresca was then asked whether it is a problem that Chelsea have 43 senior players, with BBC Sport understanding Gallagher, Trevoh Chalobah and Romelu Lukaku are being coached by former goalkeeper Carlo Cudicini.
He explained: “We’ve been in America with 28 or 29 players so it has been quite good managing the squad, the other players are training apart.
“I just finished today’s session and I am thinking about the next session. If I start to think about 43 players, managing their time, I think it is not worth it.”
Despite a swollen squad Maresca said “hopefully we can bring some players”, with Chelsea being linked to both Felix and Napoli striker Victor Osimhen.
The Italian also confirmed Reece James is the only player unavailable through injury for the match at Stamford Bridge on Sunday, with the defender already suspended after a red card at Brighton at the end of last season.