The 50-year-old Portuguese will leave Madrid at the end of this week, following Real's final match of the Spanish season against Osasuna at the Bernabeu on Saturday.
Mourinho has long been linked to a return to Stamford Bridge - where he was Blues boss from June 2004 to September 2007, winning two Premier League titles and both domestic cup competitions - and watched Crystal Palace versus Watford at Wembley.
Watford forward Nathaniel Chalobah is on loan from Chelsea, who are seeking a new manager after Rafael Benitez's interim appointment ended.
Source: PA
Source: PA