The lawsuit, which was brought by more than 30 US states on behalf of 21 million customers, claimed that the users might have paid less for apps and received a greater offering of options if not for the Alphabet subsidiary's monopoly.
Lawyers representing the attorney general of Utah, the state leading the claimants, asked for the cancellation of a trial that had been scheduled for 6 November along with other parties. The settlement, details of which were not disclosed, remains subject to approval by the court.
Lawyers for Google, and the company itself (which had denied wrongdoing in the lawsuit) declined to comment on the settlement.
The tech giant is currently facing a number of similar lawsuits claiming that it engaged in illegal tactics to preserve its monopoly in the smartphone industry in selling Android apps and in-app purchases. It is alleged that Google unlawfully mandated that some apps utilise its own payment tools, which give Google a cut of as much as 30% of digital sales proceeds.