The Paphos bus company (Osypa) called off a strike and resumed normal service on Thursday evening after reaching a deal with the government.
The transport ministry said agreement had been reached with the company, which receives government funding.
The deal provided for immediate payment of bus drivers’ wages for April.
Some 230 bus drivers had gone on strike on Wednesday, inconveniencing thousands of passengers.
In a statement, the transport ministry said that, for its part, the bus company would not be making any additional demands with regard to expenses.
The company had also agreed to provide the government income-expense data on a regular basis.
Osypa reportedly receives around €2.4m per year in state aid.