The 24-year-old Algerian international was in impressive form before a knee injury cut short his season in December.
Atal’s versatility means he can play anywhere on the right side of the pitch, in defence or attack.
And his performances have led to Watford and Napoli holding recent talks with the player’s entourage.
The 2019 African Cup of Nations winner is under contract with Nice until 2023 and feels at home there.
Nice president Jean-Pierre Rivere said on Friday that the club want to hold on to Atal and other key players.
“We will not [sign] big names. Our goal is to recruit players who join the project over several years, elements that will help us grow, to be recurrently in the top five,” Rivere told Nice-Matin.
“Here, we want to keep our best players.
“There will be departures for sure. We want to build a competitive team, with character. Our needs for specific positions have been identified.
“We want to keep Youcef Atal, and we will keep him.”
Patrick Vieira wants Atal to play a leading role in his side next season, but the Côte d’Azur club must be wary of interest from abroad.