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Schefter reports that Fangio will have a four-year deal with a team option for a fifth year.
Fangio has been the defensive coordinator for the Bears since 2015, first under head coach John Fox and then under Matt Nagy. The Bears' defense under Fangio gave up the fewest points per-game in the NFL last season as the team went 12-4 and won the NFL North Division.
Shortly after the news broke, Bears cornerback Prince Amukamara tweeted, "#cursewords."
Before coming to the Bears, Fangio, 60, was a defensive coordinator for the San Francisco 49ers and Stanford. It is not known who will replace Fangio as defensive coordinator with the Bears.
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Fangio replaces fired head coach Vance Joseph, who led the Broncos to an 11-21 record in two seasons.