Sri Lanka's cricket board and players resolved a contract dispute on Thursday, clearing the way for the team's participation in next month's World Cup.

The players had been demanding 20 per cent of the cricket board's guaranteed fee of $6.4 million from the tournament, but settled for 12 per cent, plus an additional three per cent in match incentive fees.

"We wrapped it up this afternoon. All the players signed on," cricket board chief executive Anura Tennekoon told Reuters.

The cricket board had initially offered 10 per cent plus an incentive fee, saying any more would jeopardise development activities.

The dispute caused the board to miss last Friday's International Cricket Council deadline for the contracts, but was resolved after it began direct talks with the players on Thursday, when they returned from a series in Australia.