The US offered to withdraw its troops from Syria in return for Iran taking its military out of the country's south, according to a report by Lebanon's al-Akhbar newspaper on Tuesday.
The report said that US military intelligence met with senior Assad regime officials in Damascus last month to propose the withdrawal deal.
The meeting allegedly lasted four hour hours, during which the US officials proposed that they would withdraw from the al-Tanf base and from east of the Euphrates River, according to the Lebanese daily.
In addition, Washington reportedly proposed that US firms be given a share of Syria's oil market and intelligence on terrorists.
The alleged proposal falls in line with Israeli lobbying of Moscow and Washington over Iran's presence in Syria's south. Since the outbreak of the Syrian civil war, Iran built up a military presence of thousands of units in the country to support the regime of President Bashar al-Assad.
Israel's primary concern are the Iranian units in the south, close to the illegally occupied Golan Heights.
According to an unnamed senior White House official cited by Haaretz, President Donald Trump's National Security Adviser John Bolton had travelled to Moscow in recent weeks to discuss Iran's presence in Syria.
Russian President Vladimir Putin told Bolton that he does not want Iranian forces to remain in the country but was unsure how Tehran could be pressured into withdrawal, according to the official.
Tehran has previously said that Iranian forces will not be withdrawn from Syria under any circumstances.
Iran and Syria agreed a new military cooperation deal during a meeting between defence ministers in Damascus on Monday, according to Iran's Tasnim news agency.
Iranian Defence Minister Amir Hatami said the deal will see Tehran help Syria restore its military industry.
Israel has launched dozens on strikes on Iranian and Hizballah units in Syria, in a bid to limit Tehran's reach in the country.
Iran has poured in thousands of fighters to help prop up Bashar al-Assad's regime.