"The process initiated in 2009 in the case of Caster Semenya has now been completed," track and field's world governing body said in a statement.

"The IAAF accepts the conclusion of a panel of medical experts that she can compete with immediate effect."

Semenya said: 'I am thrilled to enter the global athletics arena once again and look forward to competing with all the disputes behind me."

Richard Stander of Athletics South Africa said that they planned to pick 19-year-old Semenya for the World Junior Championships, which are due to open in Monckton, Canada, on July 19, providing that she proves her fitness.

Semenya's lawyer Greg Nott revealed that negotiations over the athlete's return to action with the IAAF had been a protracted process.

"Our direct negotiations with the IAAF representatives, through the mediator, have been ongoing for 10 months," he said.

"Meetings have been held in Monaco, Istanbul and Paris, but due to the nature of the matter the parties resolved to keep the negotiations confidential."

Another member of Semenya's legal team, Jeffrey Kessler, said: "We are delighted that Caster is finally being permitted to compete with other women, as is her legal and natural right.

"Hopefully, this resolution will set a precedent so that no female athlete in the future will have to experience the long delays and public scrutiny which Caster has been forced to endure."

The furore over Semenya's sexuality erupted after she lowered her personal best in the 800m by over four seconds at the African Junior Championships prior to the World Championships in Berlin.

Her time of 1min 56.72sec meant she had lowered her personal standard by seven seconds in just nine months.

She went on to lower her personal best to 1:55.45 in Berlin.

Her performance in Mauritius prompted the ASA to carry out a gender test on Semenya before she departed for Germany.

The ASA president at the time, Leonard Chuene, denied that such a test had taken place prior to Semenya competing in the German capital, before admitting he had lied and being suspended along with the rest of the ASA board.

It was also later revealed that Chuene had ignored a request from the ASA team doctor to withdraw Semenya from the team for Berlin.

Ruling African National Congreess (ANC) spokesman Jackson Mthembu hailed Semenya as "our golden girl".

"The ANC welcomes the decision by the IAAF to finally clear our 'golden girl', Caster Semenya, to participate in all athletics meetings as well as the international ones as a woman," Mthembu said.

"The decision by the IAAF of clearing Caster is a vindication of the ANC, her family, our Government and all progressive forces who stood behind her during her time of need.

"We appeal to all South Africans and people of the world and other athletes to assist Caster in putting the unfortunate past behind her so that she can continue on what she does best, which is running."

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June 2010: Semenya still in limbo after press conference cancelled
April 2010: Semenya claims she will return to track in June
March 2010: Angry Semenya ready to defy IAAF and race again
March 2010: Semenya lawyers claim she should be allowed to compete again
February 2010: Semenya will not run on South African circuit