The 38-year-old singer revealed she was approached about working with Billie, 21, before she became a huge star but Katy turned down the offer.
In a TikTok posted by 102.7 KIIS FM, Katy can be seen explaining: "Someone sent me an email one time that was: 'Hey, check out this new artist. I'd really like us to work with her because she was working with me for Unsub [Records].
Eilish went on to find fame in 2015 with 'Ocean Eyes' and has since won seven Grammy Awards and a Golden Globe Award and Oscar for Best Original Song.
Katy appeared in Billie's 2021 documentary, 'Billie Eilish: The World's A Little Blurry', when she revealed her partner Orlando Bloom was a huge fan.
Katy told Billie: "My fiancé who doesn't listen to modern music, he'll only play you in the car all the time."
She added: "Congrats, I'm so proud of you. I wanted to say, this is going to be wild for 10 years. If you ever wanna talk… 'cause it's a weird ride."