The government had announced in May that it would charge Uri Blau from the liberal Haaretz newspaper with unauthorized possession of state secrets, stirring up fears of a crusade to stifle the press. Journalists had said charges against Blau would make reporters hesitate to do their jobs, for fear they might end up in jail.
Blau would have faced up to seven years in prison if convicted. Instead, he will be sentenced to four months in prison that can be commuted to four months community service, the ministry said. He will admit to holding secret intelligence, without intent to harm national security, Haaretz reported.
The newspaper did not immediately issue a statement and Blau did not immediately return a call for comment.
Blau obtained more than 2,000 military documents, including operational plans and lists of potential Palestinian assassination targets, from a former soldier who copied them from army computers during her military service. About 700 were classified.
He published some of the information in investigative articles, including a 2007 story alleging the army had planned to kill wanted Palestinian militants in violation of a court order to arrest them alive if possible.
As required under Israeli law, Blau submitted all of his stories to Israel's military censor before they were published. The censor approved the articles, meaning they contained no information deemed dangerous to state security.
Still, the Justice Ministry had said in May that Blau would be indicted because "the potential for damage in the unprotected possession of the documents was enormous." It concluded the gravity of his conduct outweighed the public's right to know.
Other legal experts said the ministry could have chosen not to prosecute. Blau said he was just doing his job.
Anat Kamm, the soldier who leaked the material to him, was sentenced last year to 4 1/2 years in prison on espionage charges.
After her 2009 arrest, Haaretz kept Blau abroad for about a year to avoid prosecution. He returned to Israel after promising prosecutors to return the documents she gave him, which he eventually did.