Manuel took the majority of first-team snaps at practice this week as the Bills prepared to host the undefeated Cincinnati Bengals.
Taylor, who is officially listed as questionable with a left knee injury, has been unable to convince Rex Ryan and the Bills' coaching staff that he will be ready to play, sources told ESPN's Bob Holtzman.
Sources told Schefter that Taylor has a good chance of playing for the Bills next week.
The Bills have not publicly named a starting quarterback yet for this week. Ryan said Friday that Taylor is "feeling a lot better" but would be a game-time decision.
Manuel likely will be without at least one of his weapons on offense as receiver Percy Harvin is not expected to play because of a hip injury, sources told Schefter. Receiver Sammy Watkins, meanwhile, is still not 100 percent but will test his injured calf during pregame warm-ups and plans to play, sources told Schefter.
Manuel was Buffalo's first-round draft pick in 2013 but lost the starting job to Taylor during the preseason. The 25-year-old Manuel appeared in five games last season, completing 58 percent of his passes for 838 yards, five touchdowns and three interceptions.
Taylor, 26, has sparked the Bills to a 3-2 record in his first season as a starting quarterback. He suffered a sprained MCL in last week's victory over the Tennessee Titans and has been limited at practice this week.
ESPN's Bob Holtzman and ESPN NFL Insider Adam Schefter contributed to this report.