Schlupp, 20, spent last week with the Premier League leaders and is set to remain with Sir Alex Ferguson's side for a few more days.
The move is the latest in a burgeoning relationship between the npower Championship club and United, which has seen Ritchie De Laet and Danny Drinkwater sign for City after leaving Old Trafford and Michael Keane and Jesse Lingard arrive on loan from the 12-time Premier League champions.
"He is training with them at the moment," Pearson told the Leicester Mercury.
"I have allowed him to go there for a week. It is a great opportunity for him. We have a good relationship with United and I am not going to stand in his way to go there for a week's training.
"If anything comes of it, we will wait and see. They have had a good look at him."
Schlupp, who came through the youth ranks at Leicester, has made five starts this season but the majority of them have been at left-back as cover for Paul Konchesky.
The Germany-born Ghana international is highly-rated as a striker by the midlands club and made an impact at Brentford during a loan spell in 2011, scoring six times in 10 appearances.
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