Real Madrid will be able to sign players next summer following a successful appeal to the Court of Arbitration for Sport (Cas).
The Spanish side had originally been barred from signing players for two windows by world governing body Fifa, but that has now been reduced to just one.
The club have also had their fine reduced from 360,000 Swiss francs (£282,000) to Sfr 240,000 (£188,000).
“The Court of Arbitration for Sport (TAS) has today informed Real Madrid CF the award for partially estimating the appeal made by the club against the resolution of FIFA that imposed a penalty of prohibition of registration of players during two periods of signings, reducing it to one, the window corresponding to January 2017,” read a statement from the club.
“The decision highlights the injustice of the original ban imposed by Fifa, although the club regrets that the Cas lacked the courage to revoke the ruling entirely.”