Manchester United manager Louis van Gaal has refused to rule out the possibility of signing goalkeeper Victor Valdes.
Manchester City boss Manuel Pellegrini says he is confident that England goalkeeper Joe Hart will sign a new contract.
This season Tello has made 16 appearances in all competitions for Barca, having represented Spain at this summer's Olympics.
A Barcelona statement read: "Barcelona announce they have reached an agreement with the player Cristian Tello to extend his contract until June 30, 2016. His buy-out clause has been set at 10 million euros.
"The player will sign his contract on Monday, December 17, in the Barcelona offices."