Welbeck Landfill Site, near Normanton, has operated since 1998 amid claims of bad smells, harm to the land, pollution of the River Calder and the site being used for dumping animals, including a dead whale.
Earlier this year, the council accelerated plans to convert the site into a country park once the last waste is tipped there in 2025, following years of delays.
Run by a private company on a lease from the local authority, it was originally supposed to be restored to a public green space in 2008.
A "warts and all" report now published by the council has laid bare a number of details about its relationship with the firm, Welbeck Waste Managed Limited (WWML), also known as FCC Environment.
Among the report's revelations is how the company avoided paying rent for several years as they threatened to walk away from the site.
The president of Residents Against Toxic Scheme (RATS), the local campaign group who've objected to the landfill site throughout its lifetime, said he felt "vindicated" by the developments.
Speaking at a Cabinet meeting where the report was discussed, council leader Denise Jeffery said: "This has gone on for a long time - over 20 years.
"Mistakes have been made and we feel now that we really need to put this into the public arena, so people can see what has gone wrong and how we attempted to put it right, or didn't put it right in some cases.
"It's a historic thing.
"But we're bringing this forward now and a country park will be marvellous for the community.
"If we didn't do this people will be taking about this forever more. It's time this was drawn to a close and we move on with positive results."
It's the first time the council has acknowledged errors have been made in how the site has been handled.
Senior councillors signed off money on Tuesday for a detailed assessment to be carried out on how exactly the new park should look.
The council's deputy leader, Coun Jack Hemingway, said this represented "the first key milestone" in the scheme.
He added: "It's only right that for those who've had to live in the shadow of Welbeck that we disclose the history before we move on with our plans for the future.
"Transparency is the best disinfectant and we've nothing to hide."
In response, RATS president Paul Dainton said that he felt "vindicated" about his campaign "to ensure that the Welbeck toxic tip in Wakefield finally comes to a beautiful, fully restored wildlife and country park."
He added: "For this new Wakefield Council regime to finally accept that things could have been done far better, may be an understatement of past actions, of the Welbeck Management, the Environment Agency, officers, and past leaders of the council.
"But RATS now look forward to being involved in what would be a final chapter in the 25-year long history of the toxic tip."
Local Democracy Reporting Service