The Financial Times claims that the fast food chain, which has been engaged in an aggressive marketing push for its coffee offering in the US, has set itself the target of overtaking Starbucks as the biggest coffee seller on the continent.
Europe already has somewhere in the region of 700 McCafes, which feature high-end coffee machines and operate within or next to regular McDonald's restaurants. They can be found in Ireland, Germany, Russia and Italy, but not in the UK.
McDonald's is now opening more in France and Austria with the target of having 1,200 in operation by the end of the year.
The expansion comes as Starbucks is reducing its 1,300 stores in Europe, around half of which are in the UK. It is thought to have closed close to 1,000 of its stores over the last 18 months.
Jerome Tafani, chief financial officer at McDonald's Europe, told the FT: "We can become the biggest seller of coffee in Europe."
McCafe cappuccinos start from €2 (£1.75) per cup, while Starbucks cappuccinos are priced from £2.35 in the UK.
The McCafe chain first emerged in Australia in the early 1990s.