James Davis, 73, agreed to remove the remains of Patsy Davis after losing two appeals in state courts, The Huntsville Times reported Wednesday.
The town of Stevenson took Davis to court in 2009 after he buried his wife of 48 years in the front yard as she had requested. Davis' house is located on one of the city's two main streets.
Citing the grave's potential effect on property values and neighbor complaints, the city got a judge to order an exhumation, which was delayed by Davis' appeals.
In a hearing Wednesday, Davis agreed to pay a funeral home $2,000 to remove the coffin and vault. His wife's remains will be cremated and put in an urn.
Parker Edmiston, the Stevenson city attorney, asked the court to order Mrs. Davis's remains be buried in a licensed cemetery, noting that Davis had said he would bury the urn in the yard.
Edmiston asked for the Jackson County sheriff to be present at the exhumation to ensure no violence occurred.
"He's given every indication to this court he has no intention of removing his wife's remains from the front yard," County Judge Jennifer Hold told Davis' attorney.