The 18-year-old defender, whose contract with PSG has now expired, had been strongly linked with a move to the Etihad in recent weeks after choosing not to renew his terms in Paris. The two clubs were reported to have been in broad agreement over a switch as recently as a few weeks ago, but that move has now fallen through.
Malonga has yet to make a first-team appearance for PSG, having spent the majority of his time with the French club's Under-19 side. His departure from the Ligue 1 champions now looks set to take him elsewhere, with his immediate future left unclear following the breakdown of talks with Manchester City.
City had been expected to bring the centre-back in as part of their ongoing strategy of recruiting promising academy talent from across Europe, having taken a similar approach with other young players in recent transfer windows.
No official reason has been given for why the move collapsed, though such breakdowns at a late stage typically stem from a change of heart on the player's side, a shift in the relationship between the parties involved, or interest from a rival club offering more favourable terms.
Malonga's decision earlier this summer to turn down a new contract at PSG in favour of the move had appeared to signal a clear and settled preference for a switch to the Premier League, making the collapse of the agreement a significant setback. With no fresh destination yet confirmed, the teenager's situation remains one to watch as the transfer window continues.
The reversal leaves PSG in an awkward position of their own, having already resigned themselves to losing a player they had hoped to tie down to a first professional contract earlier in the year.
Whether the French club would be open to reopening renewal talks, or whether Malonga will instead look to secure a move elsewhere in Europe before the market closes, remains to be seen.