Ancelotti pointed out during a press conference before Rayo Vallecano's La Liga match on Sunday that the performance against Atletico Madrid was not up to par with the performance against Manchester City.
"Against City he scored three and against Atletico he did not score.
"I think on a general level he is doing very well and we're very happy with him, and we take into account -- and he takes into account -- that he is not always at his best level.
"The game against Atletico was not the best version of him."
Real Madrid beat their city rivals 2-1 in the first leg of the last 16 tie, with the return on Wednesday at the Metropolitano stadium.
In the play-off round against Premier League champions City, Mbappe netted four goals over the two legs as Madrid won 6-3 on aggregate.
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The 26-year-old striker boasts 28 goals in 41 appearances across all competitions.
"In such a demanding season (inconsistency) is quite normal, above all in a player with such quality," said Ancelotti.
"Players with quality have more ups and downs because it's something genetic, the player that has great quality finds it harder to have consistency, and that's what happened to him in that game.
"That said he's doing very well, and if we're in the Champions League last 16, it's because he's scored four goals in the (previous) tie."
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Madrid are third in La Liga, three points behind leaders Barcelona, who face Osasuna on Saturday.
Los Blancos centre-back Antonio Rudiger may miss the Rayo clash through illness, Spanish media reported.
"We're ready to fight in all games and in all competitions," continued Ancelotti, who said the defeat by Betis a week ago came because the team had little time to prepare.
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"I'm much calmer ahead of the game tomorrow because we've had five days of rest."
(This story has not been edited by staff and is auto-generated from a syndicated feed.)