The pair found fame alongside each other in the Aussie soap in the 80s, playing couple Scott and Charlene, and both have also had music careers.
Speaking on Radio 2, Donovan said that Minogue was “incredibly hardworking” and that even in the early days of the television show and the start of her chart career you could see that she had “a gift”.
DJ Scott Mills asked if the Padam Padam singer "stood out" and Donovan, 55, replied to say that Minogue was the type of person who could walk into a room and pick up a song in a couple of minutes.
“She can go, and I always used to remember on Neighbours she would come in on set, I would be slogging my way over the script the night before and Kylie would read five pages on the day and just get all the lines right,” he said.
“That doesn’t necessarily mean that one’s going to develop into the most amazing artist, but she has, and she’s just built on it.”
The star was asked if what Minogue was doing inspired him.
"Definitely," he replied.
“Yeah I was jealous,” he went on.
“God I wanted, I was looking at it going, ‘I want some of that’, you know, and I talk very openly about that. I am very honest about that."
Donovan and Minogue were on Neighbours from 1986, with Minogue waving goodbye to Ramsay Street in 1988 and Donovan following her.
They both returned to Erinsborough for a cameo last year.
Watch: Kylie Minogue and Jason Donovan to reunite for Ghosts special episode