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“We are allowing international matches to be staged in the cities of Arbil, Basra and Karbala,” FIFA president Gianni Infantino told reporters after a meeting of the FIFA Council in Bogota.
The three cities had been allowed to organise friendlies in the past year provided the security situation was “stable”.
Iraq will host Qatar and Syria for a friendly tournament starting on March 21 in Basra.
FIFA said it could not “yet” agree to a request from the Iraqi authorities to organise matches in the capital Baghdad, but Infantino promised that the city’s application would continue to be studied.
The three cities selected are among the more secure in Iraq.
Basra and Karbala both lie south of Baghdad, far from the battlefields north and west of the capital where the security forces fought the Islamic State group from 2014 to 2017.
Arbil is the capital of the country’s autonomous Kurdish region.
The Iraq Football Association welcomed FIFA’s decision but vowed to “spare no effort for games to be played in stadiums in other provinces, including Baghdad”.
“This decision puts our sport back on the rails,” it said.
Prime Minister Haider al-Abadi, who declared victory over IS in December, said the lifting of the FIFA ban was the “fruit of stability in terms of security and of the successes achieved by Iraq.”
For years, Iraq has been busily building stadiums and lobbying stars and the sport’s governing bodies for a return to the international fold.
Friday’s decision followed an international friendly between Iraq and Saudi Arabia in Basra on February 28, their first on Iraqi soil in 40 years.
It was watched by Asian Football Confederation (AFC) head Salman bin Ibrahim Al-Khalifa who said “the time has come” to end the three-decade ban.
FIFA president Gianni Infantino holds a press conference following the FIFA Council’s decision to lift the three-decade ban on Iraq hosting internatonal football
The first home competitive games could come as early as next month as two Iraqi clubs have fixtures in the AFC Cup which were postponed pending FIFA’s decision.
Infantino said it would be for the AFC to decide where they were played.
“FIFA has given the green light for the resumption but the organisers of the championship must take the final decision,” he said.
Iraq has not played full internationals on home turf since its 1990 invasion of Kuwait.
The ban, covering all but domestic matches, stayed in place after the US-led invasion of 2003 toppled dictator Saddam Hussein.
It was briefly lifted in 2012, but a power outage during an Iraq-Jordan match in Arbil led FIFA to promptly reinstate it.
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