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Rangers do an about turn an agree to pay back Sports Direct loan
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The initial decision had been taken in June following a shareholders' vote at an extraordinary meeting of the club.
But chairman Dave King told the annual meeting in Glasgow that the board has decided to pay up.
"It took me one hour this morning to raise the £5m from major shareholders," he said.
"We will advise Sports Direct we will be repaying that loan."
Ashley, who owns nearly 9% of Rangers shares, gave the Scottish Championship club £5m in January to help them remain solvent.
But Rangers want to renegotiate the terms of the contract between Sports Direct and Rangers Retail, an agreement made with the club's previous board.
Ashley won a court injunction preventing the club from revealing details of the agreement.
Rangers welcome shareholders to Clyde Auditorium Shareholders gathered at the annual meeting in Clyde Auditorium to hear the board
King told shareholders at the annual meeting at Clyde Auditorium that he was therefore limited in what he could tell them.
He said incessant litigation by Ashley and Sports Direct was an "ongoing hassle" but that he would continue to "continue to protect the club's interests".
Rangers lead the Championship in their second season in Scotland's second tier, but Hibernian have caught them in recent weeks and are level on points.
King, who stressed it was vital that Rangers were in the top flight next season, said it is the board's intention to give manager Mark Warburton sufficient resources to secure promotion and then challenge for Europe.
"We will make it back to the top of the domestic game," he said. "We will continue to improve and strengthen team over coming season."
King said Rangers are recovering from "all manner of malicious attacks" but are now irreversibly on the road to recovery.
He said that no club had been made to suffer in the way Rangers have but vowed that they will emerge stronger than ever.
PK