The 47 year old former Cheltenham Town and Burnley boss said it would be a wrench for him to walk away from the Pompey fans, "Leaving Portsmouth has not been an easy decision because of the relationship I have with people here."
"The fans, players and staff have been fantastic. It has been a tough day and I would rather just get on with it now. Forest are a fantastic club and when I heard of their interest it was very flattering."
Cotterill moved to Portsmouth from Notts County in the summer of 2010, he steered the club to a 16th place finish in the Championship and had started this season in a similar vein. The South Coast club are currently 19th in the league.
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