Courtois has been at the west London club since 2011, and wrested the No. 1 jersey from club favourite Petr Cech after shining during a loan spell with Atletico Madrid as a youngster.
In recent months, however, the Belgian has become increasingly unsettled, going so far as to skip training, while he has long been linked with a return to the Spanish capital where he spent three sparkling seasons.
And he will now line up at the Champions League holders after Madrid agreed a reported €35m (£31m/$40m) fee that will also see Kovacic spend a year on loan in London.
"Chelsea and Real Madrid have tonight agreed terms for the permanent transfer of Thibaut Courtois subject to the agreement of personal terms and passing a medical," Chelsea signalled in a statement published on the club's official website.
"Subject to the completion of the deal Mateo Kovacic will join the Blues on a season-long loan."
We have tonight agreed terms with Real Madrid for the transfer of Thibaut Courtois, subject to the agreement of personal terms and a medical. As part of the deal, Mateo Kovacic will join Chelsea on a season-long loan.https://t.co/WXhHzEdf6D— Chelsea FC (@ChelseaFC) 8 de agosto de 2018
Real Madrid also confirmed the deal, revealing that the Belgium goalkeeper will put pen to paper on a contract that takes him up to the end of the 2023-24 season.
"Real Madrid and Chelsea have agreed the transfer of Thibaut Courtois, who will be linked to the club for the next six seasons," Madrid stated on their official website.
"After the medical that will be carried out on August 9, the player will be presented at 1pm (12pm BST, 7am ET) in the Santiago Bernabeu stadium.
"Later Courtois will step out for the first time on the Santiago Bernabeu turf with the Real Madrid shirt and speak to reporters in the press room."
Courtois played a total of 154 appearances for Chelsea, winning the Premier League on two occasions.
He also boasts ample experience in Spain, having made an identical number of appearances for Atletico which included a starring role in the Colchoneros' 2013-14 Liga triumph.
Courtois may not have to wait long to face his old club, with Real Madrid set to face Atletico in the UEFA Super Cup on August 15.