High-profile gigs by stars including Madonna will go ahead as planned in London's Hyde Park this summer after a decision by councillors.
But from next year the number of concerts at the outdoor venue will be reduced from 13 to nine, following complaints about noise.
The number of people attending events will be reduced from 80,000 to 65,000 and in some cases 50,000, again from 2013, Westminster Council's licensing sub-committee ruled.
In the meantime there will be improved provisions for safety at the end of concerts, including more stewards, and for cleaning up mess left after them, both in and around the park, with costs to be met by the Royal Parks.
There will also be more monitoring points for music with a repetitive bass beat, which will be tested through the 2012 events and reassessed later in the year.
Mayor of London Boris Johnson said he was "delighted" by the decision, which meant "all systems are go for a summer like no other in our Olympic year".
The number of concerts to be held came into question after residents in well-to-do Knightsbridge and Belgravia complained about noise.
There were 109 complaints from residents in 2011, around twice as many as in 2010.
Cllr Audrey Lewis, Westminster Council's licensing chairman, said: "Legally, as central London's licensing authority, we have a duty to balance the needs of local residents with the desire of concert organisers to hold events and the compromise that the committee has reached tonight does all of this."
Mr Johnson said: "I'm delighted that common sense has prevailed. Hyde Park is one of the crown jewels of London's great outdoors, attracting Londoners and tourists alike, and this fantastic news means all systems are go for a summer like no other in our Olympic year.
"Westminster are right to respect their residents, but they also have a responsibility for the economic vitality of the capital overall. Large-scale music events like the Hyde Park concerts make a massive contribution to London's economy, underpinning the city's reputation for great music and as a global leader at staging world-class events."
John Probyn, chief operating officer of Live Nation, which is promoting gigs featuring acts such as Bruce Springsteen and Madonna at the park this summer, said: "Live Nation is delighted with the outcome of today's meeting. This is good news for the thousands of Londoners and visitors from overseas enjoying all concerts we have in place, and also the London 2012 events in Hyde Park this summer.
"We have listened to the concerns of the residents and will continue to do so while working closely with Westminster Council and the Royal Parks."