Stuart Pearce will lead the England Under-21s side in this summer's European Championships after the FA confirmed they had received permission from Manchester City to hand the job to their manager.
Pearce revealed on Sunday that he had held talks with The FA over succeeding Peter Taylor at the helm of the Under-21s side.
But the City board were believed to be unhappy with their manager dividing his time between club and country.
However, following discussions between City and the FA, Pearce will take charge of the side for next week's friendly with Spain and also next summer's showpiece championship.
The FA have also confirmed that Pearce will be assisted by Newcastle United first-team coach Nigel Pearson.
"We are very grateful to Manchester City and Newcastle United for their help and support," director of football development Sir Trevor Brooking told the FA website.
"We are delighted that Stuart and Nigel have agreed to coach the Under-21s.
"We're very pleased Stuart will take the team against Spain so that he can get to know the players.
"However, we also realise that as manager of Manchester City he must then give his full focus to the club until the end of the season.
"Stuart has huge international experience as a player and has already shown at Manchester City that he is a talented young manager."