The 24-year-old has been heavily tipped to join the European champions after Manchester United reportedly cooled their interest in the midfielder.
Kroos picked up a World Cup winners medal at the Maracana in Brazil last night after Germany secured a 1-0 victory over Argentina in extra time.
"We've finished the World Cup in the best way possible," Kroos told UOL. "Now I'm going to Madrid, so that's two dreams achieved."
Reports have claimed that Kroos may join Madrid for a fee in the region of £17m.