The NHL rejected Kovalchuk's initial 17-year $102 million deal with the Devils, believing it was a blatant attempt to circumvent the league's salary cap.
But after more than five weeks of negotiations, a new agreement was reached, paving the way for the 27-year-old to resume playing next season.
"We are very pleased with this decision which will see Ilya Kovalchuk remain a valuable member of the Devils."
The high-scoring Kovalchuk became a free agent at the end of last season, triggering a scramble between rival teams for his services.
He agreed to remain at the Devils after being offered the longest deal in the NHL but the terms, which gave him $95 million over the first 10 years and just $7 million over the last seven, immediately raised suspicions.
The NHL rejected the first deal and an independent arbitrator agreed with them after the players' association lodged an appeal, forcing a fresh round of negotiations.
The Devils did not release the details of the new deal but said everyone was satisfied with the terms.
"The New Jersey Devils acted in good faith throughout this entire process and operated solely on the assumption that our negotiations and both contracts reached were fully compliant." Lamoriello said. "We are pleased that this matter has finally been concluded to all parties' satisfaction."
(Editing by Justin Palmer)