The actor fell out with producers and TV network executives after he was sacked from hit sitcom Two and a Half Men in March (11).
The dispute raged as Sheen toured America with a one-man comedy show, but now the feud appears to have been resolved.
A statement from Warner Bros. reads, “Warner Bros. Television, Chuck Lorre, and Charlie Sheen have resolved their dispute to the parties’ mutual satisfaction.”
Lorre is the creator of the show.
TMZ.com reports Sheen will get $25 million (£15.6 million) almost immediately and an estimated $100 million-plus in profits from syndication of the show over the next seven years.
The two parties have also agreed to dismiss their lawsuits against each other.