Salah will leave Anfield on a free transfer when his contract expires at the end of the season.
Sky Sport Germany's Florian Plettenberg confirmed Liverpool have approved the move at all levels and are in talks with the winger's representatives at Roc Nation Sports, though no agreement has been reached and negotiations between the two clubs have not yet begun. PSG, who have also met with his agents, represent the main competition.
Diomande arrived at RB Leipzig from Leganés last summer for €20 million after a remarkable rise that took in a stint at an academy in Florida, a trial at Rangers — which he says broke down due to his agent at the time demanding too much — and a spell at Olympiacos that also came to nothing.
"Two years later, I was on trial at Glasgow Rangers. It's not true that I didn't want to sign for them — my agent at the time demanded too much money," Diomande said in a previous interview.
He has since become one of European football's most exciting teenagers, scoring 13 goals across all competitions in the Bundesliga this season, including a hat-trick against Eintracht Frankfurt that made him the second-youngest player to score a treble in league history. He has also declared his intentions publicly.
"I want to play at Anfield. I want to play for Liverpool. My father's dream is to see me play for Liverpool," he said in January.
Leipzig are now demanding over €100 million, emboldened by their likely return to the Champions League, and are working to extend Diomande's contract to retain him. Whether that is enough to hold off Liverpool's interest remains to be seen.