In December, the La Liga side was banned from UEFA tournaments for one season by the governing body's Club Financial Control Body due to outstanding debts and faced a possible further season out of competition if the club did not settle its owed monies, as reported by CNN.
UEFA had claimed Malaga owed player wages and had debts with other football sides as well as the Spanish tax authorities, which saw the club fall foul of the Financial Fair Play rules.
Malaga has taken its case to the Court of Arbitration for Sport (CAS), and UEFA waived the additional second year on May 17 when the club proved it had no outstanding debts, according to this BBC Sport report.
The CAS will deliver its verdict on the suspension for next season's UEFA competitions on June 4, but Malaga director general Vicente Casadois is confident the ban will be overturned, as ESPN reported.
This decision ratifies what we had already said when our fulfilment of the regulations was put in doubt. We are working, and will keep working, on this, as we are very optimistic about the future.
Malaga are currently sixth in the La Liga table with two games of the season remaining.
Under manager Manuel Pellegrini, the team were the surprise package of the Champions League this season and were only denied a semifinal clash with Real Madrid by two late Borussia Dortmund goals at the Westfalenstadion.
Malaga sold star players such as Santi Cazorla and Nacho Monreal to Arsenal this season in a bid to help ease the debts at the club and are owned by Qatari businessman and millionaire Sheikh Abdullah Bin Nasser Al-Thani, who took over the club in 2010.
There have been question marks over his commitment to the club in recent weeks, according to Spanish newspaper El Pais via ESPN.
If the suspension is fully lifted, it may be too late to prevent Pellegrini making his move, but it does allow the club more room to manoeuvre in its search for a replacement.