The wrestler was suspended from World Wrestling Entertainment (WWE) in 2015 after a tape emerged appearing to show him making racist remarks.
But the company has said he deserves a second chance after "numerous public apologies and volunteering to work with young people".
Hogan said he has been "praying for this day".
Just met with the @WWE Superstars and on all levels the volume of love and support was overwhelming. I’ve been praying for this day and I finally feel like I made it back home. Only Love 4 the #WWEUNIVERSE brother HH— Hulk Hogan (@HulkHogan) July 15, 2018
The wrestler, whose real name is Terry Bollea, was in court over the publication of a sex tape when the recording surfaced.
In the video, published by The National Enquirer, Hogan reportedly used the n-word and was heard saying "we're all a little racist".
WWE cut ties with Hogan in response and removed all references to him from its website.
The firm said in a statement on Monday: "After a three-year suspension, Hulk Hogan has been reinstated into the WWE Hall of Fame.
"This second chance follows Hogan’s numerous public apologies and volunteering to work with young people, where he is helping them learn from his mistake.
"These efforts led to a recent induction into the Boys & Girls Clubs of America Alumni Hall of Fame."
Hogan tweeted: "Just met with the WWE Superstars and on all levels the volume of love and support was overwhelming.
"I’ve been praying for this day and I finally feel like I made it back home."
The WWE Hall of Fame features more than 100 wrestlers, as well as celebrities associated with WWE.
Hogan was inducted into the WWE Hall of Fame in 2005 by Sylvester Stallone.