East Timor's parliament agreed on Tuesday to lift a state of emergency imposed following an attack on President Jose Ramos-Horta in February, parliament speaker Fernando de Araujo said.
The approval came after Ramos-Horta asked parliament to lift the emergency, but the state of alert will be extended for another month in a district where army rebels involved in the assassination attempt are believed to be hiding.
Emergency rule was declared in East Timor after gunmen loyal to rebel leader Alfredo Reinado launched early morning attacks on the 58-year-old Nobel laureate Ramos-Horta and Prime Minister Xanana Gusmao in Dili in February.
Ramos-Horta returned last week after more than two months of treatment in Australia. Gusmao escaped a separate raid unharmed.
Security forces will continue to scour Ermera district where rebel leader Gastao Salsinha is believed to be hiding, the president said.
Salsinha took command of rebel soldiers after rebel leader Reinado was killed in the attack at Ramos-Horta's residence.
Asia's youngest country, East Timor, has been unable to achieve stability since a hard-won independence from Indonesia in 2002.
The East Timor army tore apart along regional lines in 2006, when about 600 soldiers were sacked, triggering factional violence that killed 37 people and drove 150,000 from their homes.
More than 2,500 foreign troops and police remain in the country to help local security forces maintain stability.