The 27-year-old France goalkeeper moved to the Santiago Bernabeu on a season-long loan last summer as deputy to Thibaut Courtois after Keylor Navas secured a transfer in the opposite direction to become the French champions’ number one between the sticks.
Areola played four times in La Liga as Zinedine Zidane’s men won the Spanish La Liga and he also earned a winners’ medal as Los Blancos won the Supercopa de Espana in January. In total, Areola made nine appearances in all competitions for Real Madrid.
Real Madrid chose not to extend Areola’s deal in the Spanish capital, and the 13-time European champions announced on Tuesday that the former Villarreal goalkeeper will be returning to France.
"Real Madrid C. F. confirms it has brought Alphonse Areola's loan spell to an end," Los Blancos said on their website on Tuesday.
"The club would like to thank Areola for his dedication, professionalism and exemplary conduct this season and wishes him the best of luck in this new chapter.
"Real Madrid also thanks PSG for the chance to have had Alphonse Areola as part of our squad."
Areola will be unavailable for PSG for their Champions League campaign, which resumes with a quarterfinal clash with Atalanta on Wednesday.
Areola has been linked with a move to the Premier League, with the likes of Chelsea and Arsenal reportedly interested in his services.