Milan CEO Adriano Galliani flew in a private jet to Madrid on Sunday morning and Sky Sport Italia later claimed the Spanish giants have agreed a two-year deal with the Rossoneri.
No firm details were given in the report, although speculation suggests Real could release Kaka for free or allow him to go on a two-year loan.
Kaka last week made a public plea to be able to leave the Spanish giants as he looks towards cementing a place in the Brazilian national side ahead of next year's World Cup.
Coach Massimiliano Allegri on Friday praised the Brazilian's attributes and said he had "faith" a deal could be struck for Kaka.
"Kaka would strengthen us. He's versatile, and his technical attributes would be a big plus to the team," said Allegri.
"We still have two and a half days till the end of the transfer window and the club is working on it. I have faith."
The deal is now confirmed and Kaka is now set on with free transfer to Milan.