The decision was taken at a high-level meeting presided over by Chief Minister Arvind Kejriwal.
Around one lakh employees, including doctors, nurses, teachers, sanitation staff are working under contractual scheme in various Delhi government departments and agencies.
"Services of any contractual employee should not be terminated or stopped till further orders," said the brief government order issued to various departments.
Sources said contractual employees whose contractual term was nearing completion would also benefit as they will be allowed to continue in service.
Various government departments including Education, PWD, Health and Family Welfare and Women and Child Development had recruited employees under contractual scheme in the last few years.
In the its election manifesto, AAP had promised to regularise services of contractual employees in various Delhi government departments and agencies.