The French striker will see out the remainder of the 2020-21 campaign at Wanda Metropolitano
Dembele has spent the last two-and-a-half years on Lyon’s books, having been snapped up from Celtic for €22 million (£20m/$27m) in the summer of 2018.
The Frenchman has scored 45 goals in 108 appearances for the Ligue 1 outfit during that period, helping them compete for both domestic and European honours in the process.
However, only one of those efforts has been recorded in the current campaign, with Lyon sporting director Juninho admitting that Dembele’s motivation levels have dipped in recent months.
The Groupama Stadium chief revealed that the 24-year-old has been in talks over a January transfer to Atletico after the team’s 2-2 draw with Rennes on Saturday, telling Telefoot: “Moussa thinks that this is the moment to change teams, that he has lost a bit of motivation.
“This was not something we foresaw, I like him a lot. I think that Moussa has found an agreement with Atletico.”
Goal has learned that Dembele will arrive in Madrid to undergo a medical at Wanda Metropolitano on Monday before joining Los Rojiblancos on loan until the end of the season.
Atletico have moved for the former Celtic star as a replacement for Diego Costa, whose contract was terminated for personal reasons in December.
The current La Liga leaders can choose to buy Dembele outright in June if he impresses over the next six months, but a home fixture against Sevilla on Tuesday may come too soon for the forward to make his debut.
Dembele has just resumed training after recovering from a broken elbow, and will probably not be ready to return to action until Atletico take in a trip to Eibar on January 21.
Diego Simeone’s side are currently on course to win their first league title since 2013-14, as they sit one point clear of Real Madrid at the top of the table having played three games fewer.
Angel Correa and Joao Felix have been playing up top alongside Luis Suarez since Costa’s departure, but Dembele will likely slot in alongside the Uruguayan when he completes his move to Metropolitano Stadium.