The 50,000-seater Lansdowne Road stadium redevelopment, partly funded by nearly €200 million of National Lottery money, will be ready by 2008, although it will face a two-year battle to win planning permission.
Following four years of frequently bitter divisions over the issue between Fianna Fáil and the Progressive Democrats, the Cabinet finally approved the joint Irish Rugby Football Union/Football Association of Ireland plans yesterday.
The approval was given following a last-minute deal between the Taoiseach, Mr Ahern, and the Tánaiste, Ms Harney, to develop a limited sports campus at Abbotstown, the location long preferred by Mr Ahern.
Unveiling the plan, the Minister for Arts, Sport and Tourism, Mr O'Donoghue, said: 'This is a landmark day for Irish sport. We are bringing our national sporting infrastructure into the 21st century on a much-loved site that resonates with history, tradition."
The FAI will now be hoping that FIFA, the world governing soccer body, will permit Lansdowne Road to continue to host the Republic of Ireland's 2006 World Cup qualifying games, even though it breaches FIFA's current safety standards.
Lansdowne will have to close from late 2006 to allow the construction of the 50,000-seater stadium, which will be the same axis as the existing pitch - though it will move closer to the Dodder River.
The PDs refused to claim victory over Fianna Fáil following the selection of Lansdowne over Abbotstown: "This is a victory for Irish sport," a spokesman for the Tánaiste said.
Rejecting charges that Fianna Fáil had been beaten, Mr O'Donoghue said Abbotstown could not have been developed "for some years" because the M50 would have to be upgraded first.
Asked if the offer of €50 million from the businessman Mr J.P. McManus towards a fully State-funded stadium might apply to the new scheme, the Minister said: "We'll have to see what he says."
Abbotstown, which already houses the National Aquatic Centre, will be home to a new campus for all sports, including a soccer academy and a medical centre to be developed "as resources permit over a period of years". The limited development at Abbotstown was not a fig-leaf to cover the Taoiseach's embarrassment, the Minister insisted.
"These facilities will cater for all of the sporting bodies, many of whom largely depend on voluntary commitment."
Speaking in the Dáil yesterday, Mr Ahern rejected charges that money spent already on Abbotstown had been wasted. Planning work for a stadium will be useful to develop the sports campus, he said.
The new Lansdowne stadium, which will cost nearly €300 million to build, will include 64 corporate boxes and 8,000 premium seats, as well as "substantially improved" behind-the-scenes facilities for players and spectators. It is similar in design to a stadium under construction in Oporto, Portugal.
Mr O'Donoghue insisted it would be built on time and within budget.
The GAA will have freedom to use the new ground for some of its games, though this is unlikely to happen unless the association, which is holding its annual convention in April, opens Croke Park to soccer or rugby internationals.
However, Fine Gael TD Mr Jimmy Deenihan said yesterday's decision should have been made five years ago, "but the Government, the FAI and the IRFU did not want to know at the time because they all had larger ambitions.
"Why didn't the Government settle on Lansdowne Road back then? Because Bertie's vanity kept him chasing after his precious Bertie Bowl in Abbotstown," he said.
Labour TD Mr Jack Wall said the only possible realistic decision had been taken, though it should have happened earlier.
