Marca says Arbeloa will be given a coaching role in Real Madrid's academy from next season.
The former Los Blancos right-back, who graduated from the club's academy himself, will take charge of one of the 11 youth teams available.
In total, there are 13 teams in Real Madrid's academy set-up, but Raul and Dani Poyatos' jobs as Castilla and U19 bosses seem guaranteed for next season.
That leaves the U18 side as the highest Arbeloa could go with his first job in coaching.
The Spaniard is currently studying for his Pro Licence with the Spanish Football Federation (RFEF) remotely and will finish the first phase of the course in the coming weeks.