Sylvester Stallone Settles Legal Beef With 'Celeb' Contractor

Sly Stallone has settled a nuclear battle he was having on the homefront ... TMZ has learned.

Sly put an end to his $1.4 million lawsuit against contractor Mohamed Hadid, who allegedly had charged top-of-the-line prices for a job that would have been unbecoming in a double wide.

We don't know how much money changed hands, but sources connected with the case tell TMZ, "Sly was smiling."

The actor claimed Hadid -- who has appeared on "Shahs of Sunset" -- charged him a fortune for a high end kitchen island but installed cheap wood veneer/plywood. And the complaints went on and on.

In Sly's lawsuit, filed by Marty Singer, he blamed Lisa Vanderpump, who gave Hadid a four-star referral.