The wheel will give panoramic views of east London
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Another "eye" will be built on the banks of the Thames, at Greenwich, which will provide panoramic views across London.
The 55m-high (180ft) Observation Wheel will open at the Old Royal Naval College next summer.
Greenwich council previously rejected the plan, saying it would ruin the historic skyline.
"It's a new perspective on this part of London," said Duncan Wilson of the Greenwich Foundation.
"You will be able to see right up the river to the city and beyond and down river to the Lea Valley, where the Olympic sites are at the moment."
The wheel will have 40 gondolas holding six people each.
It will take two weeks to build the temporary free-standing structure, which will be open to the public from June to September.
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