Gurkhas have fought for Britain for the last 200 years, with 200,000 fighting in the two world wars.
About 3,500 Gurkhas currently serve in the British Army, including in Iraq and Afghanistan.
Speaking on Friday, Jacqui Smith, Britain's interior minister, said: "Over 4,000 ex-Gurkhas and around 6,000 spouses and children will qualify for settlement rights in the UK."
Jagat Bahadur Limbu, 51, who served in the brigade between 1976 and 1992 said the decision was "shocking".
"I have been waiting three years to be allowed to stay in Britain," he said.
The government issued the revised immigration guidelines after a high court judge ruled last October that the existing policy, which states only Gurkhas who retired after 1997 can settle in the UK, was unlawful.
Ministers say that without the restrictions, up to 100,000 former Gurkhas and their families could seek to come to Britain.
But campaigners put the number at no higher than 8,000.
Martin Howe, a lawyer representing the veterans, said he would continue battling for their full settlement rights.
He said: "It is nothing short of scandalous, all this does is insult the integrity of the men of the brigade.
"We are disgusted with what we see today."