The Germany international arrived from Bayern Munich during the close-season and has quickly become an integral part of Ancelotti's midfield, forming a formidable partnership with Luka Modric.
Kroos scored his first goal for the club on Saturday, producing a fine finish into the bottom-right corner from 25 yards to beat Cristian Alvarez in the Rayo net, restoring Real’s two-goal lead just after the break.
Sergio Ramos, Gareth Bale, Cristiano Ronaldo and Karim Benzema also all netted in the 5-1 romp at the Santiago Bernabeu, but Ancelotti singled out Kroos as having impressed him the most.
"Kroos was the best player on the pitch and got his first goal," he told reporters.
"I'm surprised he's at such a high level. His goal came on the break and he is free to go forward. When he does, Luka Modric holds. They're a good pair and are playing well."
Ronaldo scored his 18th La Liga goal of the season with a little help from some suspect goalkeeping, but the Portugal international had looked frustrated before eventually finding the net seven minutes from time.
Ancelotti did not think there was a problem with Ronaldo's performance, though, and he highlighted the defensive work put in by the Real talisman and his attacking colleagues.
"I didn't see Cristiano as anxious," he added. "It's not a problem if he doesn't score in a game. A 4-4-2 changes his work on the defensive side but he always attacks down the left.
"I appreciate the work of the forwards, especially defensively. That's what the team needs. They all did well and it’s nothing new that Cristiano or Gareth Bale scored."
