Hall was expected to join Crystal Palace on loan but Newcastle moved quickly for a key target, and will wrap up a £35million deal before next summer.
The 18-year-old full back has been at Chelsea since the age of eight. He made his senior debut at the club in January 2022, and has a total of 12 appearances for Chelsea in all competitions.
Hall is Newcastle's fifth signing in this transfer window, and manager Eddie Howe is happy to add the youngster to his squad.
"He is a player we have tracked closely, as have a number of clubs, so it's very pleasing to secure him and to add a player of his quality, versatility and high potential to our squad."
The England under-21 international is a boyhood Newcastle fan and will wear the number 20 shirt at his new club.
Additional reporting by Reuters.