Russian Sports Minister Vitaly Mutko said the player, who twiced played for Germany in friendlies, was being issued with a Russian passport and all questions of citizenship were settled, Tass news agency reported.
Mutko is also president of the Russian football federation RFS.
Russia have included Neustaedter and another foreign-born player, keeper Guilherme, in the 23-man squad for Euro 2016.
Schalke midfielder Neustaedter was born in what is now Ukraine and played two friendly matches for Germany in 2012 and 2013 before switching his allegiance.
Brazilian goalkeeper Guilherme recently made his debut in a friendly for Russia after taking citizenship.
Coach Leonid Slutsky’s squad are set for a training camp in Switzerland until June 5, with friendlies lined up against Czech Republic in Innsbruck on June 1 and Serbia in Monaco on June 5.
The hosts of the 2018 World Cup take on England, Wales and Slovakia in Group B of the Euros in France.
