City wanted to take the 30-year-old defender on a season-long loan deal due to their purse strings being tight.
The former Scotland international has been targeted by many Premiership clubs, but as City boss Kevin Keegan looks like losing out on getting Daniel van Buyten, he seemed a good alternative.
However Leeds have said they will only listen to cash offers for any player.
Just last week they rejected a similar approach by Galatasaray for Mark Viduka.