The official Bahrain News Agency said today that the newspaper would be allowed to post material following a decision by the Ministry of Information.
It gave no details for the move, but warned that all media outlets must avoid "posting anything that incites divisions or discord within the community, undermines national unity or disturbs peace."
Authorities issued the ban Monday, following a spike in anti-government protests led by the country's Shiite majority against the Sunni monarchy.
Al-Wasat is widely seen as the only independent newspaper in Bahrain, which hosts the US Navy's 5th Fleet. The paper has been ordered shut twice since an Arab Spring-inspired uprising erupted in 2011.