The decision comes after the Centre's announcement on holding discussions with political parties of the state.
Speaking to reporters, information minister Geeta Reddy said, "We are satisfied with the decision of the Centre to initiate the process of discussions (with 8 recognised political parties)."
"We met APCC president D Srinivas who asked us to withdraw the resignation. We have decided to withdraw our resignation," Geeta Reddy said.
The ministers resigned after Chidambaram's announcement on Dec 23 putting the Telangana issue on the backburner saying he would initiate wide ranging discussions on the issue.
Reddy said, "We never expected that they will respond so quickly."
She thanked Congress president Sonia Gandhi and other senior leaders including Pranab Mukherjee and Ahmed Patel for the Centre's initiative.