Atletico announced on Monday that Torres had rejoined them, seven-and-a-half years after leaving his boyhood club.
Torres, 30, has been struggling for goals since joining Chelsea from Liverpool in 2011 for a British record fee of £50million and moved to Milan on loan in August.
Chelsea and Milan agreed on Saturday to make the switch permanent, paving the way for Torres to be loaned to Atlético, where he will hope to resurrect his stuttering career under coach Diego Simeone.
Yet despite his dismal record at Stamford Bridge since joining from Anfield, Torres said he regarded his spell at the club – where he won the Champions League in 2012 – as a success.
“Chelsea gave me what I was looking for when I left Liverpool – trophies,” he said. “I’ll always see it as a success.”
The deal is subject to Torres passing a medical and will be finalised on Jan 5, 2015, when the Italian transfer window opens, Atlético said on their website.
“In this way, the forward from Fuenlabrada returns to his home where he was trained as a footballer and became one of their big stars,” the club added.
A World Cup and double European Championship winner with Spain, Torres joined Atlético at the age of 11.
Known as ‘El Nino’ (The Kid), he made his first-team debut as a 17-year-old in 2001, when Madrid’s second club were in the second division, and was appointed club captain two years later, becoming a huge favourite with the fans.
Torres himself described the move as a “dream” while thanking those who made the transfer happen.
When he left for Liverpool in July 2007, having scored 91 goals in 244 appearances, he pledged to return and could make his debut against holders Real Madrid in the first leg of a Copa del Rey last 16 tie on Jan 7.