The Magpies are moving quickly in an attempt to bring the 22-year-old to St James’ Park and fend off competition from Aston Villa and Atletico Madrid.
Newcastle’s pursuit of Munoz follows Anthony Gordon’s high-profile £70m move to Barcelona.
Manager Eddie Howe views the explosive Spaniard as the ideal, stylistically seamless replacement on the left flank.
Known for his pace and directness, Munoz also mirrors Gordon’s versatility, with the tactical flexibility to operate anywhere across a dynamic front three.
Munoz’s meteoric rise over the past year has made him one of the most closely tracked wide prospects in European football.
After a €5m permanent switch from Real Madrid Castilla to Pamplona last summer, the winger flourished with regular first-team football, recording seven goals and five assists in 36 appearances.
His impressive domestic form earned him a senior international debut in March, where he marked his arrival with a goal against Serbia, securing his place in Spain’s final 26-man World Cup squad.
While Newcastle are pushing to conclude early business, finalising a deal will not be straightforward, as Osasuna are protected by the player’s €40m release clause.
Madrid still retain half of Munoz’s economic rights, along with a buy-back option. However, they do not plan to activate their clause to bring the winger back to the capital city.