Malaga's potential European ban will remain at just one season after the club satisfied UEFA that outstanding payments for tax and transfers had been settled.
The Spanish side will be unable to compete for a season should they qualify for Europe in the next four years, but the threat of that being extended to two years has now been waived.
A statement on the club's official website said: "Malaga football club received an official communication from UEFA [yesterday], Thursday May 16, stating that the financial control committee has confirmed, after analysing the situation surrounding the Martiricos outfit as at March 31, 2013, that they are revoking the second year sanction imposed on the club."
The decision was welcomed by Malaga's general manager Vicente Casado, who said that the announcement backed up the club's claims that they would comply with UEFA.
"This decision and the granting of the licence confirms what the club has maintained since the beginning, when our compliance with regulations was first in question," he said. " We've worked, and will continue to work as hard as we can, as we're very optimistic about the future."
Malaga reached this season's Champions League quarter-finals.
