Ten Hag stripped Maguire of the captaincy last month after the 30-year-old made only eight Premier League starts last season, with Raphael Varane, Lisandro Martinez and Victor Lindelof preferred in central defence.
British media reported that West Ham had agreed a deal worth 30 million pounds ($38.01 million) for Maguire, who became the world's most expensive defender when United signed him from Leicester City for 80 million pounds in 2019.
"He has to fight for his place and he has the abilities to be a top-class centre-back," Ten Hag told reporters. "He is the best for England and I assume he will be best for us, but he has to prove it.
"When he is not confident enough to go in and fight, then he has to go. He has to make a decision. But I am happy with him... You need high-level players who are maybe not starting, but that can change."
United host Wolves in their Premier League opener later on Monday.