Palhinha agreed personal terms with Bayern and underwent a medical in Germany on deadline day, but Fulham pulled the plug at the last minute after they failed to sign a replacement.
That has left Bayern short in midfield after they sold Ryan Gravenberch to Liverpool, and the German giants plan to renew their interest in the Portugal midfielder.
Fulham moved to sign Manchester United’s Scott McTominay and Tottenham’s Pierre-Emile Hojbjerg on deadline day, and both players are likely to be available again in January.
Fulham manager Marco Silva does not want to lose Palhinha, who was signed for around £17m last summer, but the club are thought to be willing to let him go if they have a replacement lined up.
Palhinha’s agent, his brother Goncalo, said: “They [Fulham] didn’t kill the dream, they just postponed it.”