The NFF was suspended by FIFA last Wednesday on the grounds of government interference, preventing Nigeria's national and club teams from participating in any regional, continental or international competitions.
FIFA's sanction also prohibited the NFF and its members from taking part in any FIFA or Confederation of African Football (CAF) programmes or courses.
The suspension came after the Nigerian government disbanded the NFF and placed a sole administrator in charge while opening legal proceedings against the federation.
FIFA demanded the reinstatement of the NFF's executive committee after the body's president Aminu Maigari was arrested upon Nigeria's return from the World Cup.
But the government pressed ahead with the removal of Maigari and his management staff, prompting FIFA to act.
However, the sanction has now been removed after the government decided to cease its actions against the NFF.
A FIFA statement read: "FIFA has today, 18 July 2014, lifted the suspension that was imposed on the Nigeria Football Federation (NFF) on 9 July 2014 on account of interference.
"FIFA has noted that the court proceedings and order preventing the president of the NFF, the NFF Executive Committee members and the NFF Congress from running the affairs of Nigerian football that prompted the suspension have been withdrawn.
"As statutory order has been reinstated at the NFF and the legitimate bodies reinstalled, FIFA has decided to lift the suspension as of today, Friday 18 July 2014.
"The lifting of the suspension means that all rights of the NFF as a FIFA member as defined in article 12 of the FIFA Statutes are reinstated."
Nigeria's World Cup ended in turbulent fashion, with players boycotting a training session in the build-up to their last 16 defeat to France amid reports of a bonus row with the NFF.
Their exit from the tournament was followed by the resignation of coach Stephen Keshi, who brought his time in charge to an end after nearly three years at the helm.
