Fulham will return to Craven Cottage from the start of next season following a two-year ground-share with QPR.
Fulham's future is still uncertain
Planning permission for a £5.4m upgrade of the ground, bringing the capacity up to 22,000 has been granted and work is expected to be completed by July 2004.
Seats will be bolted on to terraces and new floodlights will be installed.
Fulham chairman Mohamed Al Fayed is still planning to move the club to a brand new stadium in west London if a suitable location can be found.
Fulham moved out of Craven Cottage - its base for 105 years - in May 2002 so that the ground could be redeveloped into a 30,000 all-seater stadium.
Arrangements were made to groundshare at Queens Park Rangers' Loftus Road stadium for two seasons while the work was completed.
Plans to build the new stadium were initially delayed by legal action from a group of residents and later unforeseen technical difficulties rendered the redevelopment plan unworkable.
Fulham's chairman, Mohamed Al Fayed said: "I am delighted to fulfil the dearest wish of our fans to take us home - albeit temporarily.
"Craven Cottage has a warm place in my heart. Its beautiful riverside setting gives it a special atmosphere and it is closely bound up with the history of this great club."
Back to the Cottage spokesman Tom Greatrex said: "Fulham FC are going home.
"Our temporary exile has seen crowds suffer and been to the detriment of the club.
"We hope the club can now learn lessons from the unhappy aspects of the last 18 months and start working seriously with the council, football authorities and fans to find a long-term solution for the club in Fulham."
Hammersmith and Fulham Borough Council decided that the proposed small increase in capacity at Craven Cottage will not bring environmental problems.
Local MP Iain Coleman added: "I am delighted. This decision means Fulham Football Club have come home."