The child from Ivory Coast was discovered at Spain's border in the north African enclave of Ceuta on May 7 during an attempt to smuggle him into Spain to join his parents.
On Thursday morning, authorities announced they would grant him ‘leave to remain for one year' and that he would shortly be reunited with his parents, who are in Spain legally, according to a report by Spanish news agency Efe.
The story has struck a cord in Spain highlighting the plight of desperate migrants going to extraordinary lengths to get into Europe.
It emerged that the father of Adou had paid €5,000 to intermediaries who promised to get the correct papers to bring his son into the country and said he had no idea he would be smuggled in inside a suitcase.
Ali Outara told a court on Monday that he had repeatedly tried to bring his son into the country through legal means to join his wife and eldest daughter in the Canary Island of Fuertaventura but had failed because his monthly salary was just €41 short, according to a report in El Pais.
He said the law requires an income of €1,331 a month and that he only earns a monthly salary of €1,290 working at a launderette.
The boy who has been cared for at a juvenile centre in Ceuta, where he has been visited by his mother Lucille, will now be reunited with his family pending the results of a DNA test to confirm the relationship.
A judge has opened an investigation into the attempted smuggling for which Adou father could face criminal charges.