Portsmouth have accepted a "substantial bid" from Real Madrid for Lassana Diarra, the Premier League side said in a statement on their official website. The France midfielder, 23, has been given permission by Pompey to speak to the Spanish giants.
"Portsmouth Football Club can confirm they have accepted a substantial bid from Real Madrid for Lassana Diarra," the statement said.
A Pompey spokesman added: "We have always said that we would only allow our players to leave if we received an exceptional bid. We could not stand in the way of such a move as this for Lassana."
"It shows how far the club have come under the ownership of Alexandre Gaydamak, when Real Madrid come in for one of our players. Should the deal be completed, the club has already identified possible replacements."
Diarra, who has scored three goals in 30 games for Portsmouth, played a key role in helping the club win the FA Cup last season - the first time they had lifted the trophy in 69 years.
Real have been on the lookout for a defensive midfielder since last week, when Mali international Mahamadou Diarra was sidelined for the rest of the season after undergoing knee surgery. The Frenchman, who has also played for Premier League giants Chelsea and Arsenal, would appear to fit the bill.
Reports in the British press have estimated the value of the deal at around £20m, which would represent a welcome cash injection for a Portsmouth.