French defender Koscielny refused to travel with the Gunners' squad for their pre-season tour in the hope of securing a departure from the Premier League club this summer.
Switzerland international Xhaka was one of five players to pull on the armband under Unai Emery last season and the Telegraph reports that he is the favourite to become the club’s next permanent skipper.
Of the other players to have led the side last season, Koscielny is forcing his way out, while Petr Cech and Aaron Ramsey have already left.
Xhaka and Mesut Ozil are the only previous captains remaining at the club, and while Nacho Monreal was considered, the potential arrival of Celtic’s Kieran Tierney would reduce the Spaniard's game time.
The midfielder has experience in the role, having skippered former club Borussia Monchengladbach as well as the Switzerland national team.
Get the best features, fun and footballing frolics straight to your inbox every week.
Thank you for signing up to Four Four Two. You will receive a verification email shortly.
There was a problem. Please refresh the page and try again.