Glasgow City Council bosses had feared the site in Castlemilk's Drakemire Drive would cost them as much as half a million pounds to clear up.
However, the Evening Times can reveal a deal has been done to hand over the land, owned by local government spin-off Jobs and Business Glasgow, to private firm Ryan Plant Hire for a nominal fee.
Ryan is now shifting an estimated 5000 tonnes of rubbish from the site and filling in the dump with rubble from a secondary school demolished in East Renfrewshire.
Council bosses admit Jobs and Business Glasgow has effectively written off the value of the land by handing it over for nothing. But they say the business would have lost even more if it tried to clean up the site itself.
A spokesman for Jobs and Business Glasgow said: "It was important for the local community that the waste dumped on site was cleared; which meant we faced a very substantial bill to restore a bit of land which we would then have very little use for.
"Our agreement with Ryan Plant Hire means the site will pass to them. They have taken on responsibility for restoring it, before putting it into good use as a depot."
Jobs and Business Glasgow was left with the illegal landfill after the site was abandoned by tenant DC (Skips) Ltd.
The company did not have a licence to dump at the site but was licensed to use the yard at Drakemire Drive as a waste transfer station.
That licence has since been suspended and DC (Skips) Ltd has ceased trading.
The Jobs and Business Glasgow spokesman added: "We are obviously not happy that the former tenant has put us in this position, but the deal with Ryan is the best option."
Ryan itself, meanwhile, has run in to problems with its watchdog, the Scottish Environment Protection Agency, which has told them to stop dumping rubble because the site's licence remained suspended after the DC (Skips) probe.
East Renfrewshire Council said its main contractor had launched an investigation and that the "ongoing" demolition of Eastwood High was not affected.
Ryan's managing director Frank Kelly said he was transferring the licence. He said: "We are still allowed to remove material - just not take more to the site."
Ryan specialises in carrying rubble from building sites.