Foxes, who finished 14th last season, are currently top of the table, one point ahead of Manchester United.
They meet on Saturday (17:30 GMT) and when asked if Claudio Ranieri’s team could win the league, Van Gaal said: “It is possible, I think.”
Van Gaal called Leicester striker Jamie Vardy, the league’s 13-goal top scorer, a “nasty” player to come up against.
Vardy marked his first Premier League start by making four goals and scoring the other as the Foxes beat United 5-3 in September 2014.
The England international, 28, has equalled former United forward Ruud van Nistelrooy’s record of scoring in 10 successive Premier League games, and could better it on Saturday.
“He was already a very nasty player for us last year,” Van Gaal said of Vardy.
“He scores, he provoked a penalty, now scoring 10 goals in a row, he is a great player. I only know Dennis Bergkamp as a player who did the same with Ajax. It’s not so easy to do that.”
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