United put Thompson up for sale
The Tannadice outfit have decided to make him available for transfer after talks over a new deal broke down.
The 24-year-old is out of contract at the end of the season and the club would prefer to cash-in on him when the transfer window re-opens in January rather than risk losing him for nothing in the summer.
Rangers have been strongly linked with the Scottish international and they could step up their interest in him in January or wait until he becomes a free agent in the summer.
With Billy Dodds set to join United, Rangers could be willing to offer cash plus Dodds for Thompson's signature.
The club offered Thompson the best deal in their history to keep him at the club, but it seems that he will soon be leaving Tannadice.
"The chairman and manager have been working closely with Steven Thompson to agree a deal that would keep the striker at Tannadice," said a United spokesman.
"Indeed, the club is so keen to keep the player they have tabled the best-ever deal offered to a Dundee United player.
"Ideally, the matter should have been tied up in the close season. However, this did not happen.
"Now, after six weeks of negotiating with the new chairman and manager, the player and his agent have made it clear they see Steven Thompson's future lying elsewhere.
"In these circumstances, the club has no alternative but to make the player available for transfer, with any transfer moves taking place from January 1.
"Dundee United Football Club regret they have had to initiate this move but unfortunately they have been left with no alternative."
Thompson has vowed to continue to give 100 percent for the team until he secures his move elsewhere.
"I fully understand the position of the club in this matter," said Thompson. "The club required a positive answer from myself as quickly as possible and unfortunately I was not able to give this.
"However, as long as I remain a Dundee United player, I want to assure the supporters that I will be giving 100 percent on the pitch."