Existing $2.50 concession fares will continue on trips between Eden and Bomaderry on the south coast and Lismore to Tweed Heads on the north coast, reversing a government plan to cut state support for the services.
Travellers faced paying up to 25 times more for trips if the axe fell on the subsidies, worth hundreds of thousands of dollars per year.
But on Friday the Labor government said the cut-price fares would continue while long-term planning took place to replace a "complex web of bespoke regional bus contracts" it inherited from the former coalition administration.
"We are facing a cost-of-living crisis in NSW and I am committed to making sure our regional communities have accessible and reliable transport," Regional Transport Minister Jenny Aitchison said.
"We will not continue the former government's approach of ad-hoc contracts and concessions, which is why we will be spending the next year developing a long-term plan which works for the community."
About 17,000 passengers received a subsidised rate to travel on the Eden to Bomaderry bus route in 2023.
Half of those were seniors and pensioners paying a $2.50 regional excursion daily fare to get on the 300km service.
The opposition described the decision as a backflip from the Minns government after a "reckless decision".
"Common sense has prevailed, and our regional residents will finally get the support they need," Liberal frontbencher Natalie Ward and National MP Dave Layzell said in a joint statement.
Bus operator John King previously said the majority of the people on the route were heavily reliant on the government support, which was needed to make concession fares available and services viable.
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