The Bayern Munich midfielder enjoyed an excellent campaign with Germany in Brazil, playing a starring role in their World Cup win which culminated with a 1-0 extra-time victory over Argentina.
Kroos, who finished the tournament as the leading creator with four assists, confirmed after the final in the Maracana that he would indeed be leaving Bayern for Real.
Madrid were linked a number of weeks ago, but at that time Kroos refused to comment as he was concentrating on the finals.
But now Kroos has revealed that he will be heading to the Santiago Bernabeu this summer.
“We’ve finished the World Cup in the best way possible. Now I’m going to Madrid, so that’s two dreams achieved," Kroos told UOL.
However, his agent Volker Struth later played down the move to Madrid and declared nothing had yet been signed and that he will discuss the future with Kroos on his return from Brazil on Tuesday.
"It has not yet been decided where Kroos' future lies, I can guarantee that," Struth told the Express newspaper.
Struth says Kroos will meet with him in Majorca on Tuesday, after his and the rest of the World Cup-winning Germany team's welcome back in Berlin, and a decision will be made within 24 hours.
"We'll sit down and decide what's to be done," he said. "We will announce his decision either on Tuesday evening or Wednesday morning."