The 22-year-old has penned a three-year contract, keeping him at the City Ground until 2026.
Hudson-Odoi made his competitive debut for Chelsea in 2018 and has since made over 120 appearances, scoring 16 goals in the process.
But the left winger failed to nail down a regular starting spot and was loaned out to Bayer Leverkusen for the 2022-23 season.
However, the move didn’t work out, as he scored only once in 21 appearances.
Chelsea manager Mauricio Pochettino made it clear the 22-year-old wasn’t part of his plans for the new season.
The Cottagers re-entered the race for the young player after Ocampos turned down their offer but lost the transfer battle to Forest in the end.
The Tricky Trees have had a hectic transfer deadline day. They completed a move for Nicolas Dominguez before bringing in Nuno Tavares on loan from Arsenal.
Forest have also launched a bid for Trevoh Chalobah, while PSV Eindhoven star Ibrahim Sangare is on the verge of joining the Reds.
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