The Belgium international has helped lead the Blues back into the Champions League this season, but he believes they will have trouble stopping the men from the Spanish capital, who have won the competition in each of the last two years.
“Real Madrid are now the best team in the world,” he told Marca.
Hazard, whose future at Stamford Bridge has long been under question, also took time to praise Zidane.
“Zidane won everything as a player and as a coach, he is a special guy, everybody knows him as a player,” he continued.
“When you think of football, you think of Zidane because he could do anything on the pitch. It's magical and I'm very happy to see him on the pitch.”
The 26-year-old winger, meanwhile, insists that he is not agitating for a move to Spain.
“I’m happy in England and I play for one of the best clubs,” he said.
Alvaro Morata arrived at Stamford Bridge for £70 million from Real Madrid in the summer and Hazard, who has yet to play for the first team this season, is confident he will strike up an instant relationship with the Spaniard on the field.
“I've never played with him and I'm looking forward to it,” he said. “He is still very young, but he has won many titles with Juventus and Madrid, so he has a lot of experience.
“We need this type of player, able to score many goals, and Alvaro can do it. We are happy with him. He's a good guy, talkative, even in English ... We're looking forward to playing together.”
Hazard featured for 15 minutes in Belgium’s 2-1 World Cup qualifying win over Greece on Sunday having captained the national team to a 9-0 win over Gibraltar earlier in the week – the first competitive football he has played this season.