Midfielder Kante hinted while on international duty with France he was flattered about being linked with a move away after a stellar season.
He made his debut for France against Russia on Tuesday, scoring the opener in a 4-2 victory, on his 25th birthday.
Ranieri has always conceded he will not keep unhappy players at the shock Barclays Premier League leaders and while he hopes to keep Kante he would not stand in his way if he wanted to leave.
"I think he should rest here. He is working very well. But if some big teams arrive who give us a lot of big money, maybe we can think about it," he said, ahead of Sunday's visit of Southampton.
"If he is not happy here and wants to go. I don't want sad people here. I want happy people.
"He is always smiling. It is speculation and now our focus is on the pitch. After is another season."
Kante, who joined from Caen last summer, had previously said: "I will fight for Leicester this season, next season we never know and we will see.
"At this moment I am focused on Leicester. We have to finish well this season but I don't mind about (being linked with) the other clubs."
Source: PA