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The People's Party came top in a snap September election, but have only now agreed a deal with the Greens.
It is the first time the ·¹Çø®Ä«½Å¹ß=·¹Çø®Ä«½Å¹ß left-wing party will serve in government.
"We succeeded in uniting the best of both worlds," Mr Kurz said on Wednesday. "It is possible to protect the climate and borders."
Greens leader Werner Kogler said Austria ¸íÇ°ÈĵåƼ=¸íÇ°ÈĵåƼ should now become a European leader on climate change issues, telling reporters that both parties "have possibly agreed on more than we could have imagined beforehand".
Full details of the coalition will be announced on Thursday. But the leaders suggested they would aim to lower taxes in general - a People's Party pledge - while bringing in higher environmental taxes, in line with È«Äá·¹Çø®Ä«=È«Äá·¹Çø®Ä« Green policies.
Mr Kurz is expected to return as Austria's chancellor, while Werner Kogler is expected to serve as vice-chancellor.