The Portuguese international will attend a ceremony at 1:45 pm (1145 GMT) with Real president Florentino Perez at Real Madrid's Santiago Bernabeu stadium to mark the renewal of his deal, the club said on its website.
The 28-year-old's record since joining Madrid from Manchester United for a then world record 94 million euros back in 2009 has been phenomenal with the Portuguese scoring 203 times in 203 appearances.
Real Madrid did not give details of the contract extention, but Spanish newspaper El Pais reported that the deal will run until 2018 and make Ronaldo the best paid player in the world.
"The salary of the player will be close to 20 million euros, making him the best paid footballer in the world," it said.
Four-time World Player of the Year Lionel Messi was the previous highest paid player in Spain with a salary of 16 million euros a season.
The deal ends a series of drawn out negotiations that began back at the end of the 2011-12 season.
Speculation then mounted that the Portuguese would leave the Spanish capital after he said he was "sad" in September last year and was believed to be upset at the lack of support offered to him by the club in his quest to reclaim the Balon d'Or, which Messi has won for the past four years.
However, any chance that Ronaldo could make a sensational return to Manchester United or indeed to big-spending French duo Paris Saint-Germain or Monaco now seems a long shot with the player set to under contract until he is 33.
Despite the speculation, Perez was always confident that the player would renew his contract and end his career at Real.
"Ronaldo wants to retire at Real Madrid, and we want him to retire here, just like [Zinedine] Zidane and so many other great players did," Perez said in July when asked about the reports that Ronaldo was planning to leave the Spanish side.
Since then Perez has splashed over 90 million euros once more on Gareth Bale.
The Welshman's transfer from Tottenham was finally sealed at the start of September and he made his debut for the club alongside Ronaldo on Saturday, with both men scoring in the 2-2 draw at Villareal.
Bale is just the latest in a string of "galactico" signings, Real president Perez has made during two spells in charge of the club, in a drive to boost their commercial revenue and success on the pitch.
Auditors Deloitte's latest Money League report showed that Real had become the first football club to generate more than 500 million euros a year, whilst Forbes ranked them as the most valuable sports team in the world last month with an estimated value of $3.3 billion.
