The 31-year-old forward signed a short-term agreement with the Championship club at the start of the season and his form has won over supporters.
The Senegal international has scored four goals in 13 starts including a goal to help eliminate Southampton from the Capital One Cup on Tuesday evening.
But the two parties are stalling over a longer-term deal amid suggestions Diouf was expecting a significant pay rise after proving his worth.
"Dioufy loves it at Leeds," said the player's agent Willie McKay, quoted in the Daily Mail.
"He took a massive wage cut to join and was hoping something could be resolved down the line that reflects his performances."
Rival Championship clubs are now believed to be alert to the possibility of swooping for the former Liverpool man.
Ajax has released their away soccer jersey for the 2013/14 season. Get in the Gear.
The new PUMA evoSPEED 1.2 FG. A great new soccer cleat with classic look and first time for PUMA to be on the cleat.
The Liverpool 2013/14 soccer jersey is available for pre-order. The Reds are eager to compete for silver next season.
One of the top soccer cleats for control the Nike CTR360 will not let you down on the field in tight spaces.
adidas has added some color to the Predator line with this new colorway. Released on May 17. Be the first to own a pair.
The Juventus jersey for the 2013/14 was released earlier this week. Be the first to wear the colors of the Old Lady.
The push for more color on their cleats, adidas has added the infrared colorway to the adiZero f50 Line.
Chelsea won the Europa League on Wednesday. The Blues defeated Benfica 2-1 on injury time goal from Ivanovic.
The adidas Nitrocharge is the most talked about new cleat in years. It was released on May 15 and will take your pitch by storm.
Bayern Munich are kings of Germany and hope to be crowned kings of Europe at Wembley later this month!