Gammy was left in Thailand when his intended parents, Australian couple David and Wendy Farnell, took his healthy twin sister, Pipah, home with them.
The surrogate mother, Pattaramon Chanbua, who has been looking after Gammy since, says she applied for his Australian citizenship as a way to safeguard his future.
Australia's Department of Immigration and Border Protection has confirmed that the child's application for citizenship by descent had been granted, although Ms Chanbua said she had no immediate plans to take her son to Australia.
'I want him to be near me here so that I don't have to miss him', she explained.
'But if all of my family, including me, die and if Gammy is left behind alone, at least the Australian government will help him', she added. The decision means that Gammy is now eligible for an Australian passport and will have access to healthcare in the country, reports the Australian Times.
The case initially sparked worldwide attention and an intense debate over international surrogacy arrangements, while an online campaign raised over Australian $240,000 to help pay for hospital bills and buy a new home for Chanbua's family.
In August last year, it was revealed that David Farnell, 56, had 22 child sex convictions, prompting an investigation by Australia's Department for Child Protection. Farnell continues to have custody of Pipah, although the family is under strict court conditions.