They won 3-1 by outclassing Valencia in the competition’s semi-final match.
Isco and Luka Modric scored either side of half-time to put Zinedine Zidane’s side further at ease.
Then, Dani Parejo converted a consolation penalty kick for last year’s Copa del Rey winners in added time.
Real Madrid will meet the winners of Thursday’s semi-final match between FC Barcelona and Atletico Madrid in Sunday’s showpiece at the King Abdullah Sport City Stadium in Jeddah.
Germany international Kroos caught Valencia’s Jaume Domenech out to open the scoring in the 15th minute.
He curled a cross towards goal while the goalkeeper was still organising his defence and the ball flew over the line before Domenech could recover.
The soft manner of the goal appeared to hit Valencia hard after an even start to the game and Isco put Real Madrid further ahead by volleying home in the 39th minute.
His goal came after a sweeping move involving Federico Valverde and Dani Carvajal.
Modric buried Valencia’s faint hopes of a second half revival, providing a classy finish with the outside of his boot in the 65th minute to completing another incisive Real Madrid counter-attack.
“We were in complete control throughout the game. We came out with the intention of getting hold of the ball. That’s what we did and our plan worked perfectly,” Real Madrid midfielder Casemiro told reporters.
The 62,000-capacity arena was around two-thirds full for the first game of the competition.
It used to be a two-legged season curtain raiser between the Spanish league champions and the Cup winners but has been given a radical facelift.
Spanish football federation chief Luis Rubiales spearheaded the changes to the format.
Rubiale increased the number of teams to four and signed a three-year deal to move it to Saudi Arabia which media reports say is worth 40 million euros annually.
(Edited by: Olawale Alabi)