The Daily Mail says Defoe is finally free to play in Tottenham's Barclays Premier League clash at Wigan on Sunday after chairman Daniel Levy came to an agreement with Portsmouth chief executive Peter Storrie last night.
Pompey had been angered by Spurs' decision to parade Defoe on the pitch before Tuesday's Carling Cup semi-final with Burnley when he had yet to sign for them.
Defoe has been training with his new team-mates all week, but behind the scenes Levy was still thrashing out a deal for the striker with Storrie.
Although a fee of £15.75million had been agreed by the clubs on Monday, Portsmouth had not agreed to Tottenham's proposed payments schedule and were beginning to drag their heels, with late interest in the player from Manchester City.
Last night, Spurs' highly-regarded club secretary John Alexander received what one insider referred to as a 'herogram' from Levy after completing the paperwork in time for Defoe to play against Wigan.