The International Criminal Tribunal for the former Yugoslavia (ICTY) said Karadzic had asked that the former military leader act as a witness for the defence.
Both men have been charged with genocide, war crimes and crimes against humanity over their roles in the 1992-1995 Bosnian war, in which 100,000 people died.
Karadzic expects Mladic to testify that “in numerous conversations and meetings he had with the accused ‘they never agreed or planned to expel Muslims or Croats’ from areas under Serb control,” The Hague-based court said in its ruling.
The 68-year-old is blamed for authorising so-called “ethnic cleansing” in the bitter war against Bosnia’s Muslim-led government.
Mladic, 71, had refused to testify in Karadzic’s trial, citing his health and the amount of time taken up by his own trial.
But the judges rejected Mladic’s argument, saying he was in a unique position to tell the court what information he had given the accused in relation to incidents he was allegedly involved in. He is expected to give evidence in January.
The ICTY was created in 1993 to try perpetrators of war crimes committed during the former Yugoslavia’s bloody break-up.
Karadzic and Mladic both face charges over the massacre of almost 8,000 Muslim men and boys in the eastern town of Srebrenica in July 1995.
They could have been tried together had they been arrested around the same time. But Karadzic was arrested in July 2008 and Mladic in May 2011.