Gordon Bain had submitted a planning bid to Scottish Borders Council to locate the truck on land at Station Yard in Traquair Road.
The application led to objections that it could take away trade from town centre retail outlets.
Concern was also raised that the truck would be located too close to Innerleithen Cemetery.
But when members of the council’s Local Review Body met via video-link on Monday, they overturned the application’s original refusal in August last year.
In a report to the committee, a spokesperson for the applicant argued that providing a catering service outside Innerleithen town centre would tackle congestion which results in “bikes propped against walls and doorways”.
Councillor Eric Small said: “I think there is a demand for this sort of business in this area.
"Innerleithen is known world-wide for its mountain biking and hopefully in the future it’s going to get an innovation centre.
"That’s going to bring in a lot of people at weekends and for certain occasions and there is demand for something like this business, to provide food for the cyclists.
“There have been a lot of objections to cyclists taking up the pavements in the High Street, parking bikes and obstructing local people, and I think this would take them away from the town centre and I’m in favour of granting permission for this.”
Councillor Scott Hamilton added: “The business case presented here is very clear.
"It is catering for an audience that isn’t currently being catered for very well in Innerleithen.”
Councillor Neil Richards said: “This is a good use of land and it’s not a permanent thing, so if it’s a success, great, and if it’s not then it won’t be a problem in the future.”
Approval has been granted for a three-year period, with opening times between 8am to 6pm.