Those occupying land at Wellington's Shelly Bay remain there, but say they're in de-escalation talks with the city council.
A notice of motion drafted by eastern ward councillor Sean Rush and supported by mayor Andy Foster is also likely to be withdrawn, having "served its purpose".
Tensions have been running high at the site, where a $500 million development is planned, for the past month.
The situation reached a tipping point following two notices for Mau Whenua to vacate the land, after occupying it for a year. The group claims the Port Nicholson Block Settlement Trust went against the will of its own people when it sold its land for development and that the deal was done in secret.
The second notice, issued by Wellington City Council gave protesters 24 hours to leave the land by 6pm on November 17.
Council chief executive Barbara McKerrow made the decision citing health and safety concerns regarding imminent construction on the developer's adjoining land and asbestos risk on council land.
Her decision was challenged by way of Rush's notice of motion, which would allow Mau Whenua to stay on their current site but in a reduced area.
Under the proposal, the restricted area would be reduced to within a 2m perimeter of the building of concern.
The move astonished some councillors and prompted accusations the mayor had undermined the chief executive on an operational decision.
Rush said he made the move when it was clear the situation at the site had escalated.
"There were photographs showing the site that had been inhabited by a dozen or so Mau Whenua members, were now joined by up to 100 people from all over the North Island."
Rush was concerned the council would issue a trespass notice following the notice to vacate.
"You do that to be able to give yourself legitimate powers to ring the police to ask people to leave and if they don't, they're forcibly removed and that was not something that was going to happen on my watch."
He said the fact people were not "dragged off in paddy wagons", which he said would have been a terrible look for Wellington and New Zealand, showed the notice of motion had served its purposed.
"People are talking now and that's the first step towards a peaceful resolution and I don't know what the road map is, but this is the starting point."
Rush said he would withdraw the notice of motion after finishing discussions with council staff, colleagues and Mau Whenua.
Mau Whenua's most recent post on the group's Facebook page said they were in kōrero with Wellington City Council about a de-escalation strategy.
The post said additional supporters were still welcome on the whenua.
Council spokesman Richard MacLean said council officers have been working with Mau Whenua on a peaceful resolution for several months, as new information has come to light regarding asbestos related hazards as well as impending construction activity.
"We are not in a position to provide more detail at this time", MacLean said when asked what the de-escalation strategy was.
He said the land was closed to the public and it was not lawful for people to remain on site.
MacLean said the council's position had not changed in so much as those occupying the land needed to vacate as soon as possible for their own health and safety and that of anyone else who might enter the site.
"We are working through this with Mau Whenua who have been fully informed of the risks of remaining on site."
A "red alert" remains in place at Shelly Bay, which Mau Whenua said meant the developer was moving in and the whenua was under threat.
Mau Whenua spokeswoman Shamia Makarini said the de-escalation discussions were about moving from red alert to amber.
She said councillors made the right call by filing the notice of motion.
"Because it did allow us to start those conversations and de-escalate the situation.
"We believe we're one email away from confirming the de-escalation and that is to allow for further conversation to occur."
Makarini said the group still maintained the sale of the land to developers was not valid.
She said what happened last month was unnecessary and the group would like to avoid that happening again.
Port Nicholson Block Settlement Trust chief executive Lee Hunter said the trust was still keen to develop its commercial opportunities by moving forward and establishing a construction zone.
"We're giving Mau Whenua every opportunity to read the situation and at some stage, we are going to have to put a spade in the ground."