Downing has two years left on his contract at Villa Park, but is ready to leave the club.
He said: “I know the club are keen for me to extend my contract.
“But I’m 26 and at a major crossroads in my career. I do want to play in the Champions League at some point so I won’t be committing to a new deal at the moment.”
Dalglish hopes to complete the signing of Downing by the end of next month.
