Leaving Certificate students will have the option of a calculated grade or a written exam in each subject.
The Cabinet Sub-Committee on Education has signed off on the proposals, after hours of talks on how the exams should progress.
Each student will be given a calculated grade for every subject, and the choice of sitting the written exam for that subject.
Whatever the better result is between those two will then be taken towards their final result.
Students can opt to take a calculated grade and not sit the physical, written exam.
It is the intention that practicals and orals will go ahead for those who also opt to sit the written exam in that subject.
The State Examinations Commission (SEC) will have a larger, and legislative, role in the process this year.
Students will not get to see their calculated grade before they sit the written exam.
While the Junior Certificate exams have been cancelled due to capacity concerns about running the exams at the same time as the Leaving Cert.
'A fair system'
The timetable for the written exams in June will be published on Thursday.
For those choosing to take the exams, oral examinations will be held during the Easter holidays or shortly after - while coursework will proceed in subjects where these form a normal part of the exam.
But additional time will be provided for completion of this work.
The Department of Education says the holding of practical examinations will not be possible "in some subjects", and this will be advised as soon as possible.
Education Minister Norma Foley said: "All stakeholders have worked extremely hard to get to this point.
"I have listened carefully to all, and we have worked together to find solutions.
"Students and parents have been clear on the need for both clarity and choice which I believe his decision gives them.
"As requested by the student representatives we explored thoroughly the option of providing the SEC-Accredited Grades to students in advance of the written examinations, but this option is not possible.
"I am conscious that many students are concerned that they have not covered the full curriculum for their subjects in class, due to the interruption of in-person learning caused by the pandemic.
"Everyone wants a system that is fair and that provides the opportunity for real progression for students."
Calls for choice
It comes as students called for them to have an option in the State exams.
Cathal from Co Kerry told Newstalk his preference would be calculated grades, but a choice needed to be there for either.
"I think calculated grades would suit a lot of people - that choice should be there for others that wouldn't like to get calculated grades.
"That choice should be there for them to sit the traditional Leaving Cert too", he said.
While fellow Leaving Cert student Darragh said it was only fair for them to get a choice the same as last year's class did.
"I think it's only fair after we missed all the time last year, and then missing an unknown amount of time this year that we get a choice as well".
"I'd be sitting a calculated grade, but like Cathal said, I understand that not everyone would like that - so I would rather a calculated grade, but I think we should have the choice for the people who don't want [and] who would rather sit the exam".
Minister Foley has said she hopes schools will be able to return on a phased basis from March 1st.
She told her Cabinet colleagues on Tuesday that work is underway for a full return to classrooms next month.
However, the date is yet to be agreed with teachers unions and other stakeholders.
Additional reporting: Jack Quann