The companies confirmed the agreement in separate statements made to Re/code. Despite their legal truce, they acknowledged their business competition outside the courtroom will continue to remain strong.
"Microsoft has agreed to withdraw its regulatory complaints against Google, reflecting our changing legal priorities," a company spokesperson said. "We will continue to focus on competing vigorously for business and for customers."
"Our companies compete vigorously, but we want to do so on the merits of our products, not in legal proceedings," Google added.
Instead of taking their problems directly to regulators, the two tech giants will first discuss any potential conflicts between themselves, a person familiar with the matter reported to The Wall Street Journal.
Prior to this agreement, Microsoft had complained to antitrust regulators in the US, and also in the European Union, where it was especially vocal about Google's advertising practices and YouTube app, the Journal wrote.
This is the most recent update from an increasingly positive relationship between Microsoft and Google. In September 2015, the two firms agreed to drop about 20 patent-related lawsuits and hinted they were looking ahead towards a more productive working relationship.
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The cases all involved disputes over the use of various patents related to smartphones, online video, and a range of other technologies, including Motorola Mobility.
The newly amiable relationship between Microsoft and Google can be attributed, in large part, to their leadership. Microsoft CEO Satya Nadella and Google CEO Sundar Pichai have a more collaborative approach than former Microsoft CEO Steve Ballmer and Eric Schmidt -- former executive chairman of Google and current chairman of parent company Alphabet.
After taking the helm at Microsoft, Nadella has placed substantial focus on putting Microsoft products in the hands of global users regardless of the devices they choose. "Our mission is to empower every person and every organization on the planet to achieve more," Nadella declared last year.
Under his leadership, Microsoft has launched and upgraded its apps and services, such as its Office suite and Skype for Business, to work on iOS and Android.
Microsoft is not only rolling out its own apps for competitor devices, it's enabling developers to do the same. At its Build 2016 conference, the company announced plans to integrate Xamarin into Visual Studio, which developers can now use to build apps for competitor platforms.