The Arsenal manager has long professed his interest in Mbappe, who has become one of Europe’s most coveted prospects after a remarkable season at Monaco, where he has scored 23 goals in 37 appearances.
That form has reportedly triggered interest from the likes of Real Madrid and Manchester City and Wenger conceded that the 18-year-old’s price tag may have risen beyond the level at which Arsenal can compete.
“Of course [we're targeting Mbappe],” Wenger told SFR Sport. “It would be hypocritical and a lie to say we're not following him.
“But he's perhaps already in the category of clubs who perhaps have more financial potential than us.”
Should Arsenal miss out on Mbappe it will be particularly galling for Wenger, who admitted earlier this year that he had tried to sign the youngster last summer only to be rebuffed by Monaco.
Rather than acquiring one of Europe’s top attacking talents much of Wenger’s summer could be focused on ensuring the two he has in his possession – Mesut Ozil and Alexis Sanchez – do not move on.
Both have just over a year to run on their contracts and talks over extensions have been shelved until the end of the season.
Wenger admitted that Arsenal could not allow themselves to lose either player, comparing the damage an Ozil or Sanchez exit would do to his side with what would happen to Monaco should Mbappe leave.
“I think they should stay here because they are two world-class players and it's difficult to find world-class players even when you have a lot of money because a lot of clubs have a lot of money and few players can make the difference,” he said.
“Look at Mbappe at Monaco. The whole of Europe is already onto him -- he's had 20 games -- because everything is known immediately now, so you can't allow yourself to lose your best players.
“And not only us in our situation -- you can't lose them, you have to find new ones, bring them in. So we have two conditions: one, to keep them, and two, bring in other great players.”