Muhammad, a 6-foot-6 guard, will be eligible to compete Monday when UCLA plays Georgetown in the Legends Classic in New York. Muhammad's family will have to repay approximately $1,600 in impermissible benefits he was deemed to have accepted, and the three games he has already missed will serve as his suspension.
"UCLA acknowledged amateurism violations occurred and asked the NCAA on Friday afternoon to reinstate Muhammad," the NCAA said in a statement. "The university required the student-athlete to miss 10 percent of the season (three games) and repay approximately $1,600 in impermissible benefits."
NCAA student-athlete reinstatement guidelines say that when the value of benefits are greater than $1,000, the punishment is "withholding of 30 percent of eligibility for one season of competition and repayment." Thirty percent of a college basketball season is considered nine games.
Muhammad received the suspension penalty normally associated with benefits ranging between $500 and $700, yet still has to repay "approximately $1,600."
When asked by ESPN about the discrepancy, NCAA spokesperson Stacey Osbourn replied, "We don't have anything to share beyond the statement at this point."
A lengthy NCAA investigation revealed that Muhammad had received travel expenses and lodging during unofficial visits during his recruitment. Muhammad's attorney, Robert Orr, said those visits were to Duke and North Carolina and were paid for by Benjamin Lincoln, a financial adviser from North Carolina who is a friend of Muhammad's family.
"I'm excited to be able to play for UCLA starting next Monday," Muhammad said in a statement issued by the school. "My family and friends were very supportive of me throughout this process and I couldn't have gone through this without them."
The investigation lasted for more than a year and in February, before Muhammad had signed with a school, the NCAA warned schools recruiting him that his amateur status was in jeopardy. About three hours before the Bruins' Nov. 9 season-opener, UCLA announced that the NCAA had found Muhammad ineligible to compete. UCLA appealed, and the NCAA heard the appeal Friday.
"I am relieved that this long, arduous process has come to an end," coach Ben Howland said in a statement issued by the school. "So many people worked very hard on this case and I am eternally grateful to them as well as the Bruin family, who stood by us throughout. I am pleased that Shabazz will be able to begin his collegiate career."
Muhammad's first game will be against Georgetown in the semifinals of the Legends Classic on Monday at 8 p.m. ET at the Barclays Center in Brooklyn (ESPN2). The No. 13 Bruins will face either No. 1 Indiana or Georgia the following day.
"We are extremely grateful that this matter has come to a conclusion," UCLA athletic director Dan Guerrero said in a statement. "This entire process has been challenging on many fronts, but we believe strongly in the principles of fairness, integrity and due process. We are satisfied with the outcome and pleased that Shabazz will be able to join his teammates on the floor, representing UCLA in Brooklyn on Monday night."
Orr, the attorney representing Muhammad, said he was "delighted" and that this was "the right thing to happen." He expressed his appreciation for the hard work UCLA had put in throughout the arduous process and for the support the school showed his client.
"He just wants to play basketball and go to school and thousands of dollars and hundreds of hours have been invested in determining if he can play," Orr said.
"With a high-profile recruit and signee like Shabazz, there is a whole culture around it and I think the NCAA was following every rumor, every finger that was being pointed, whether there was any reliability to the accusations or not."
ESPN.com college basketball reporter Dana O'Neil contributed to this report.