The deal would mean any vodka not made from cereals, potatoes and molasses would have to say 'vodka made from' on the label, instead of simply 'vodka'.
It is hoped the measure, which will go to a vote in the European Parliament next month, can end a row that has plagued EU members for the last year and stalled new European Commission proposals for defining spirit drinks.
The compromise looks to have ended claims from Polish, Baltic and Finnish producers that true vodka could only be made from potatoes or cereals.
One industry insider said it was now "almost certain" that these countries had failed.
The news is a serious blow to the countries, which make more than two thirds of the EU's vodka and are understood to have spent large amounts of time and effort on trying to restrict vodka ingredients.
Opponents of Eastern Europe's puritan bloc believe their argument is merely a cynical ploy to gain ground in Europe's fastest growing vodka markets around the Mediterranean.
Opponents of restrictions, which include the UK, Ireland and Hungary, say fruit and other ingredients can be added during vodka distillation without changing the taste. They say tighter rules would also hamper innovation in the sector - such as vodka made from grapes.
Threats of a dispute at the World Trade Organisation have widened the crisis recently.
The US, which makes most of its vodka from sugar cane, has said it will challenge the EU if the definition compromise is too strict. This publication also understands that South Africa has written to the European Commission, warning of a similar challenge.
Commission officials, now led by the German presidency, have spent recent months attempting to devise a legal position on the dispute, in the hope that may aid a solution.