The 55-year-old, who cannot be named, has pleaded on human rights grounds to stay in Britain despite the slaughter of prisoners of war during Saddam’s invasion of Kuwait in 1990.
Now Interior Minister Priti Patel has backed down after a 20-year legal battle, despite admitting he was responsible for ordering the executions.
A total of 440 Kuwaitis were killed in the invasion that started the first Gulf War.
The war criminal arrived in Britain in 2001, claiming he was threatened by Kurdish collaborators.
His requests were turned down in 2003, 2007 and again in 2014, as his story changed, until he finally appealed under human rights law.
His claim that he would face inhuman or degrading treatment if sent home was accepted by Judge Stephen Smith.
But Robert Clark, a researcher at the Henry Jackson Society, said: “British authorities should have turned him over to Kuwaiti authorities after the initial appeal was dismissed.
The Home Office declined to comment on the case, but said: “We will fix the faulty asylum system. “