The music event's organiser Michael Eavis has signed up the Irish rockers - Bono, The Edge, Adam Clayton and Larry Mullen Jr. - to perform for the first time at the world famous festival which celebrates its 40th anniversary next year.
A source said: "Everyone is over the moon that the deal has been done. Michael really wanted a huge name for the 40th anniversary and the fact U2 have never played Glastonbury in their 32-year career only adds to the mystique."
The 'Get On Your Boots' hitmakers - who will headline the festival on Friday June 25, in Somerset, England - have been in discussions with Michael, 74, for some time.
The source added to Britain's The Sun newspaper: "Eavis has been asking them for a while now and really stepped up the effort this year. This could be an iconic moment."
Glastonbury tickets sold out just hours after their release last month, even though no acts had been named.
At the time, Michael promised the festival would be full of the world's best musicians.
He said: "There will be three or four superstars. The expectations are really high and we're trying to get the best headliners in the world."
'Can't Take My Eyes Off You' singer Andy Williams recently revealed he had also been booked to perform at the world-famous event.