McIlroy had previously spoken of being in an "extremely sensitive and difficult position" over the issue of representing Ireland or GB&NI, not to mention the third option of simply not playing to avoid controversy.
However, on the eve of the Irish Open at Fota Island, the 25-year-old from Northern Ireland revealed he would continue to represent Ireland, as he had done throughout his amateur career and twice in the World Cup. "I've been thinking about it a lot," McIlroy told a pre-tournament press conference. "I don't know whether it's been because the World Cup has been in Brazil and I've been thinking a couple of years down the line. Thinking about all the times that I played as an amateur for Ireland and as a boy and everything, I think for me it's the right decision to play for Ireland in 2016."
Asked if he had been "torn" on the issue, the former world No.1 added: "More worried about what other people would think, rather than me. But you've got to do what's right for yourself and what you feel most comfortable with, and ultimately that was the decision that I made.
"I was always very proud to put on the Irish uniform and I would be very proud to do it again. Just because I'm playing golf for money and I'm a professional I'm supposed to have this choice or this decision to make, where if you look at the rugby players, cricketers or hockey players, they view Ireland as one, the same as we do in golf. I don't think there's any point to change that or go against that just because it's a different event or it's the Olympics."
Golf's world rankings will be instrumental in the make-up of the 60-player field in Brazil in two years' time, with sixth-ranked McIlroy firmly on course to be involved.
McIlroy, who split from his fiancee Caroline Wozniacki last month, added of his Olympic decision: "I've had a lot of time on my own the last few weeks and been thinking about it a lot. It's something that's been quite important to me and something that I needed to make some sort of decision or some sort of stand on it. Just weighing up everything, and thinking back about the times that I played for Ireland and won the European Team championship with Ireland, I just thought why change that? Basically it's just a continuation of what I've always done."
It had been suggested the decision could be taken out of McIlroy's hands by an Olympic regulation which stated he could only represent Great Britain if three years have passed since representing Ireland.
That rule means McDowell had already committed to playing for Ireland in Rio by contesting last year's World Cup in Melbourne, but McIlroy added: "There's been a lot of people giving their opinion and what they think I should do.
"But at the end of the day it's a decision that I had to make for myself because it's something that you have to live with. It's taken me long enough to sort of get over the hurdle, but it's definitely the right decision."
McDowell welcomed the news and said he had not received any negative reaction to his own, which could see the Ryder Cup team-mates reunited in Rio. "I think it's great that he's put it to bed at last," McDowell said. "I think it was a contentious, complicated issue that I suppose could have been settled very quickly with a straight answer. I'm glad that he's committed and I'm hoping to be there alongside him. There's no doubt he'll be there. We are in a unique scenario in Northern Ireland. We could easily declare for Great Britain or we could easily declare for Ireland. We have all-Ireland teams and we have sports which are split: obviously soccer is two teams and rugby is one team.
"To me, golf is always an all-Ireland sport. I grew up wanting to wear the green blazer with a Shamrock on it and have a green golf bag with the Ireland logo on it. So it makes sense that the best players in Ireland, whether it be north or south of the border, should want to represent Ireland in the Olympic Games.
"It's a very difficult decision, though, because if you want to get religious or political about it, declaring for one or the other, you're going to upset someone theoretically. I was kind of glad that I had the opportunity to play the World Cup last year and put it to bed personally for me. There's been absolutely no negative reaction and I don't expect there to be any negative reaction [to McIlroy].
"From a golfing point of view, as players we receive equal support from north and south of the border. Thankfully our sport doesn't really kind of draw that contentious crowd like some of the other sports do. I don't see there being any problem with this."
Of course, depending on the result of a the independence referendum in Scotland on September 18, sportsmen and women in Northern Ireland may not be the only ones with a dilemma over allegiance for the Rio Olympics.