Air France-KLM and Etihad Airways are said to be in negotiations over codeshare and interlining opportunities.
French national newspaper Le Figaro reports that the SkyTeam carrier is on the "point of alliance with one of its old enemies".
If Air-France-KLM and Abu Dhabi-based Etihad did enter into a partnership it would represent a significant shift in strategy for the European group. Its chairman and chief executive Jean-Cyril Spinetta has previously been among the most vociferous opponents of the Gulf carriers, which he previously said were "killing our industry".
Air France said that during its summer schedule for 2012 it is suspending flights to Abu Dhabi as part of an overall reduction in seat capacity to the Middle East of 17.5%.
Air France said it had "no comment at all" on the report, while Etihad was not immediately available for comment.