The 25-year-old Senegalese striker is the joint-top scorer in the Bundesliga so far this season, scoring 13 goals in 16 games to attract interest from clubs outside of Germany.
Mark Hughes' Cottagers were thought to be preparing a £5 million swoop in January, but Cisse is believed to be settled in Germany and would only consider a move away from the Badenova Stadion if a club offering Champions League football - such as the Gunners - came calling.
"There’s no mistaking he’s very happy at Freiburg and he’s under contract until 2014, but Arsenal certainly interests him," an unnamed source close to the player told Goal.com.
"But Fulham is not an option. All respect to the club, regardless of whether they can afford him, he wouldn’t want to go.
"Freiburg are a great but small club so it's very likely he will go in the summer. And Cisse is worthy of Champions League football, that is what he's aiming for."
And Freiburg's general manager Dirk Dufner also conceded that it will be hard to keep hold of his star striker, if he continues to be as prolific during the second half of the season.
"He [Cisse] has a contract with our club until June 2014 and he is a key player within our first team," Dufner told the same website.
"However, I feel that it will be a challenge to keep Papiss here."
Cisse has spent most of his career in the lower echelons of French football, including a four year stint with Ligue 2 team Metz before joining Freiburg on a five-year deal in January.
Emirates Stadium supremo Arsene Wenger is not expected to make a move for a striker in the New Year, with Robin van Persie, Marouane Chamakh, Nicklas Bendtner and Carlos Vela on Arsenal's books as well as attacking midfielders Andriy Arshavin, Samir Nasri and Theo Walcott.
By James Martini
