The Senegal defender joined the Wearsiders on a six-month loan deal from Al-Hilal last week but O'Neill believes that Mangane is not ready to play yet.
"He's got a great physique and presence and certainly has what it takes to do the job," O'Neill told the Daily Star.
"But it's fair to say that Kader's a little bit behind the rest of the lads in terms of fitness. Once he's fully fit, he'll be pushing for a start in a position where we've been really stretched of late.
"Whenever a loan signing comes in from abroad, part of the deal is that there has to be an option at the end of the deal for a permanent signing and that's the case with Kader."
Sunderland face Swansea City in the Premier League on Tuesday evening.