Owners of large bingo competitions will be able to pay out 75% of their takings in prize money.
For smaller events, where the prize money is less than €5,000, there is no change to the current law.
The news follows a vote in the Dail last night, in which the Government had wanted to impose a prize money cap of 50%.
But the change came following an amendment proposed by Sinn Fein's Martin Kenny, which was seconded by Independent TD Denis Naughten and then supported by the Government.
The proposal to ensure a minimum of 25% of proceeds go to charity remains unchanged.
The news comes after protesters staged bingo games outside Leinster House on Tuesday.
Speaking after the issue was resolved, Mr Kenny said: “There was a very organised lobby by the commercial bingo operators against this bill, but the main objection being put forward was that there was a cap of 50% of takings at any licenced bingo game being allocated to prizes.
“My simple amendment changed that 50% to 75%, leaving it at the discretion of the operators as to how much they give as prizes.
"The original figure of 25% of the takings going to the charitable cause remains the same.
“The Minister made the point that commercial bingo in this state is illegal and all operators must contribute to charity as a condition of their permit (under €5,000) or licence (up to €30,000 weekly).
“The previous legislation did not specify how much should go to the charitable cause, but this sets it at a quarter of takings."
He added: “The vast majority of smaller, community-run bingo games will not be affected by this legislation at all.
“While there was a lot of confusion about the possible repercussions of this bill, the debate tonight brought clarity and a sensible solution to the situation.
“I am delighted that this Sinn Féin amendment has ensured that bingo games and operators can continue as normal, and that the situation, which had caused concern to many bingo goers around the country, has been resolved.”
The legislation will now progress to the Seanad.
