The Geordie pop princess, 30, is said to have won a payout from the producers of the US talent show, who dropped her after filming just one episode.
At the time, reports said Cheryl was removed from the show because of her Newcastle accent.
The hype around her new, exciting position was suddenly left in tatters.
Girls Aloud star Cheryl sued producers Blue Orbit for £1.4m for loss of earnings earlier this year. According to legal papers filed in Los Angeles Superior Court, the singer was promised a salary of £1.1m for the first season, and an additional £1.2m for the second.
The BBC reports that the case has now been settled out-of-court, with the production company paying the '3 Words' singer an undisclosed sum.
Cheryl was replaced by Nicole Scherzinger in May 2011, after attending X Factor auditions in two US cities.
The singer's spokesman confirmed to the BBC: "Cheryl's dispute with Blue Orbit has been resolved amicably."
Cheryl recently returned to the studio to start work on her fourth album, which is due for release in 2014, while Simon Cowell has also hinted that he'd like her back on the UK version of The X Factor.
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Watch the video for Cheryl Cole's single 'Call My Name':