Afridi, 31, was set to make his debut for Hampshire in their FL t20 opener against Somerset earlier this month.
But the PCB suspended Afridi following his criticism of the board and the England and Wales Cricket Board then removed his Hampshire registration.
He was also fined 4.5 million rupees (£62,000) by the PCB.
The former Pakistan captain pleaded guilty to a charge of violating the board's code of conduct.
Afridi held a meeting with the PCB on Tuesday and then withdrew a petition he filed against the board in the Sindh High Court on Wednesday, opening the way for his NOC to be reinstated.
His representative Umran Khan had told BBC Radio Solent he was confident that Afridi, who was also poised to play Twenty20 cricket for Hampshire last summer but opted to lead Pakistan in the Test series against Australia instead, would soon be turning out in the county's colours.
"Shahid will be able to play for Hampshire next week," Khan said on Tuesday.
"The meeting between Shahid and Ijaz Butt [PCB chairman] went very well and both parties have come to an amicable agreement.
"I spoke to Giles White [Hampshire manager] and they're very pleased that it's all sorted.
"Shahid is very excited to finally be linking up with Hampshire and get back to doing what he loves, which is playing cricket."
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