France captain Kylian Mbappe has told officials at Paris Saint-Germain that he intends to leave when his contract expires at the end of the season, a source close to the Ligue 1 champions said on Thursday.

The 25-year-old, who arrived in Paris from Monaco in 2017, had extended his contract in 2022 until 2024 but last summer declined to activate a clause allowing him to stay another year at PSG.

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Mbappe has been widely tipped to move to Real Madrid and, according to a source close to the matter, has already entered negotiations with the Spanish giants.

“The terms of the departure have yet to be fully agreed,” the source said, adding that the club and Mbappe will make an official statement “when everything is finalised in the next few months”.

PSG declined to comment when contacted by AFP but it is understood that Mbappe’s departure will be formally announced in a few months’ time.

“PSG are focused on the future,” said the source.

Mbappe will leave PSG on a free transfer but the blow to the club will be softened by an agreement they reached last summer which will see the player waive bonuses amounting to around 60 to 70 million euros ($AUD99 million to $115 million).

After seven seasons at PSG, Mbappe, the club’s all-time top scorer with 274 goals, looks set to seal a move to Real Madrid, the club that the player has dreamt of since he was a child.

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Real have made no secret of their desire to bring him to the Santiago Bernabeu. In 2019, 2021 and 2022, club president Florentino Perez considered signing him, only to be rebuffed each time.

For PSG, the departure of their main star, a year after the exits of Neymar and Lionel Messi, marks the beginning of a new era of uncertainty.

Coach Luis Enrique is expected to be given the powers to shape a new, young and coherent team.

At the highest levels of the club, it has been hammered home in recent months that the priority must be the “recruitment of several players when Mbappe leaves”.

PSG will, said a source close to the club, continue its transformation “towards the collective and youth”.

However, Mbappe has been a prolific striker, who has scored far more than any other player this season.

He broke the deadlock again on Wednesday in a 2-0 win over Real Sociedad in the last 16 of the Champions League.

Mbappe also has more than 111 million subscribers on Instagram, giving PSG a wide international profile.

Mbappe last spoke on the issue of his future in early January when he insisted he had yet to make up his mind.

“I haven’t made my decision, I haven’t made my choice. But we have an agreement with the president (Nasser Al-Khelaifi) which means that all parties are protected,” he told French television.

Mbappe, who has 46 goals from 75 international appearances, is paid some 70 million euros a year.

As a free agent he will be able to negotiate a blockbuster signing fee on top of any salary increase.

If the 2018 World Cup winner and 2022 World Cup top scorer does join Madrid in July, he would join English sensation the 20-year-old Jude Bellingham and Brazilian strikers Rodrygo and Vinicius, one of whom would have to make way for the Frenchman.