The Home Ministry ordered the Herald newspaper last week to stop printing its Malay edition for violating a 2007 ban on the use of the word "Allah," except to refer to the Muslim God.
The newspaper had been using "Allah" as a translation for God, regardless of denomination, as is typical in Malay.
The dispute has become a touchstone for recent religious tensions in Malaysia, which is predominantly Muslim but prides itself on its ethnic harmony.
The government agreed Thursday to lift the ban.
"If they stop printing the word 'Allah,' they can publish anytime," Che Din Yusoh, a senior official with the ministry's publications control unit said.
The Herald's English, Mandarin and Tamil editions - read mostly by the ethnic Chinese and Indian minorities - were not affected by the ban.
Malay is the language of the majority Malay Muslims as well as indigenous Christian tribes in the eastern states of Sabah and Sarawak.
The Herald has challenged the "Allah" ban in court, saying the translation has been used for centuries in Malay and that the Arabic word is a common reference to God that predates Islam.
It says the ban is unconstitutional and threatens the religious freedom of minorities.
The government, meanwhile, says the use of the word by non-Muslims could confuse Muslims.
The court has not yet issued a ruling.
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OK, now who would be confused, again?
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