The Scottish champions have been ranked in 30th place, with Spanish side Valencia - who knocked Celtic out of the Europa League - and Turkish giants Fenerbahce dropping out altogether after featuring in the three previous lists.
The treble treble winners had an Enterprise Value (EV) of £227 million according to the report from the world-renowned auditing company, making the 32-team list for the first time.
Real Madrid have leap-frogged Manchester United at the top, the Spanish giants having an EV of £2.9 billion compared to the Red Devils’ £2.89 billion.
German club Bayern Munich are third (£2.43 billion), Barcelona fourth (£2.41 billion) and Manchester City in fifth (£2.1 billion).
Celtic are ahead of Spanish side Villarreal (£223 million) and Turkish outfit Galatasaray (£221 million).
The report is compiled using the latest publicly available financial statements for 38 European football clubs that meet the selection criteria, with the top 32 making the list.
“Football-specific metrics” - that is, profitability, popularity, sporting potential, broadcasting rights and stadium ownership - are also taken into account.
England dominate the list with nine clubs, while Spain and Italy have six apiece in the list.
Celtic, who posted a £15 million profit for six months until last December, are Scotland’s only representative.
KPMG global head of sports Andrea Sartori said “After three years of stability on the podium, this year brought some turbulence, with Real Madrid leapfrogging Manchester United at the top, and Barcelona slipping to the fourth spot, letting Bayern Munich take the third position.
“As last year, the big five football leagues are represented by 27 clubs. The English Premier League has confirmed its absolute dominance, having nine clubs on the list and accounting for 43 per cent of the total aggregate value.
“This year, Scotland’s Celtic FC is a new joiner, together with Villarreal [of Spain].”