The decision was taken in a cabinet meeting today chaired by Chief Minister Arvind Kejriwal.
The government's move comes after the onion prices were stabilized in the market.
"We want to bring down the price of onions more in the market and in view of this, government has decided to sell them at a subsidized rate - Rs 30 per kg," Food and Supplies Minister Asim Ahmed Khan told reporters here.
Khan said that by opening its sales channels directly to the citizens, the government has achieved the desired purpose of "controlling and stabilising" onion prices in the retail market and also in mandis of Delhi.
We will continue to strictly monitor the price movement of onions from time to time and necessary interventions on our part will continue till the prices stabilise completely, he said.
The city government had been selling the kitchen staple at Rs 40 per kg since Monday.