He will have a tough act to follow, after Zinedine Zidane won an unprecedented three Champions League titles in a row, as well as a La Liga title, two UEFA Super Cups and two FIFA World Club Cups during his two years in charge.
"Julen Lopetegui will join the club after the participation of the Spanish team in the World Cup, after two years of leading the national team".
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The timing is also unexpected as Spain kick off their World Cup campaign on Friday when they take on Portugal at the Fisht Olympic Stadium in Sochi, Russia.
Spain are among the favourites to win the World Cup after an nearly flawless qualifying campaign, and he will be hoping that the announcement does not overly unsettle his squad just before the competition gets under way.
His decision to quit as Madrid coach suddenly left the Spanish giants in limbo.
Real, who are now without a manager following Zinedine Zidane's shock departure earlier this month, are ready for a summer shake-up.
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Lopetegui returned to club management with Porto in 2014, but he was sacked midway through his second season after failing to deliver silverware, leaving the club in January 2016 with the club third in the league, and out of the Champions League.
Indeed, Spain are still unbeaten under the Basque after 20 matches including friendlies.
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