Kylian Mbappe has decided against signing with Real Madrid and instead has agreed to a three-year extension with Paris Saint-Germain.

Real Madrid had been confident of their chances of signing Mbappe on a free transfer.

"I would like to announce that I have chosen to extend my contract at Paris Saint-Germain, and of course I am delighted," Mbappe said in a statement.

"I am convinced that here I can continue to grow at a club that provides everything necessary to perform at the highest level. I am also delighted to continue to play in France, the country where I was born, where I have grown up and where I have made my name.

"I would like to thank the President, Nasser Al-Khelaifi, for his trust, his understanding and his patience. I would also like to thank all the fans of Paris Saint-Germain, both in France and around the world, for their support, especially in recent months. Together, side by side and ambitious, we will make magic in Paris."

PSG sporting director Leonardo could leave the club as a consequence of the deal, with Mbappe preferring the former Monaco and Lille executive Luis Campos as a replacement, while Pochettino's future was also in doubt.

Madrid's transfer strategy has been built around their pursuit of Mbappe in recent years, and they will now plan for life without him.