The Republic of Ireland international regularly impresses for the Toffees and with Arsenal in need of midfield reinforcements he could be the perfect option.
That said, Everton are unlikely to let him go without a fight, and manager Roberto Martinez said as much in his press conference on Tuesday, addressing the reports linking McCarthy with the exit head on.
"James is someone who we rate highly," Martinez said. "He can grow and get better. He also has a long-term contract. Interest in him is a compliment."
Everton showed with Manchester United's pursuit of Leighton Baines that they will only conduct transfer business on their terms and have no intention of selling their best players.
McCarthy certainly comes in that category and despite the reports of Arsenal's interest, the fact he has a contract until the summer of 2018 suggests he is going nowhere.
RM: "James is someone who we rate highly. He can grow and get better. He also has a long-term contract. Interest in him is a compliment."— Everton (@Everton) December 2, 2014