Representatives from both parties have finally put pen to paper on the documents which will now see the Moy's End of the League One club's stadium redeveloped immediately.
Posh chief executive Bob Symns told the club's official website: "As everyone is aware we have been talking to the council on a regular basis and are delighted to confirm that all documentation has been signed and that it is all systems go on the redevelopment of the Moy's End section of the stadium.
"Work will commence imminently and I am sure everybody connected with Peterborough United is delighted with this news."
Head of strategic projects for Peterborough City Council Richard Hodgson said: "As planned we expect to fully start work on the new Moy's End stand and skills centre next month. In addition, we are currently in the final stages of preparing a planning application for the retrofit of the London Road stand."