He still faces a battle to avoid extradition after the South African authorities accused him of arranging the murder of his new bride Anni, 28, last year.
The pair were on honeymoon in South Africa when their taxi was hijacked and she was later found shot dead.
After taking an overdose of pills last month Dewani, 31, appeared in court today and was sent to the hospital.
He had been on bail at his family home in Bristol but the South African authorities said he should be taken into custody after what was thought to be a suicide attempt.
Smiles ... Shrien with Anni
However, lawyers for both sides agreed today the care home owner should be admitted to the Priory Hospital Bristol instead.
Dewani is said to be suffering from severe post-traumatic stress syndrome and remains subject to £250,000 bail.
Strict conditions on his on-going freedom remain, including a curfew. He must also report daily to a local police station.
A psychiatric report by Professor Nigel Eastman, written after the overdose, suggested it was "unlikely he intended to kill himself on this occasion".
District Judge Howard Riddle ruled that from tomorrow morning, Dewani must live and sleep at the private hospital - a specialist centre for treating mental health problems.
Dewani spoke only to confirm he understood the bail conditions at Belmarsh Magistrates' Court in south-east London today.
The court had heard on February 24 that Dewani was rushed to Bristol Royal Infirmary by ambulance when his sister dialled 999 four days earlier.
She found him collapsed in his bedroom after swallowing a cocktail of 46 pills, including diazepam prescribed to counter anxiety and help him sleep.
The South African authorities want Dewani to stand trial over claims he ordered the killing of his bride in Cape Town last November.
Mrs Dewani, from Sweden, was shot when their cab was hijacked in the Gugulethu township.
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She was found dead in the back of the abandoned taxi with a bullet wound to her neck.
Cabbie Zola Tongo claimed his vehicle was hijacked and he and Dewani were ejected before Mrs Dewani was driven away and killed.
But in a plea bargain later, Tongo claimed Dewani offered him 15,000 rand (£1,400) to arrange the killing.
Tongo, 31, was caged for 18 years for murder, kidnapping, robbery with aggravating circumstances and perverting the course of justice
Dewani denies arranging to kill his wife.
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